We are also pleased to reaffirm that Afya remains on track to meet our full-year 2025 guidance, supported by disciplined execution and strong business fundamentals. Once again, we delivered strong performance closing the first half of 2025 with a notable growth of 15% in revenues, reaching BRL 1.856 billion. Adjusted EBITDA reached BRL 893 million, expanding 20% year-over-year with an impressive margin of 48.1%, an increase of 228 bps over last year. In addition, supported by the increase in adjusted EBITDA, our basic EPS climbed to BRL 4.69 recently, representing a 17% increase over the previous year.

Moving to our operational updates, we have 3,653 approved seats with the closing of the FUNIC acquisition, which contributed an additional 60 seats to our portfolio. Furthermore, our number of undergrad medical students has reached almost 26,000 students, representing nearly 14% growth compared to the first half of 2024. In addition, the medical school net average ticket, excluding the Unidom acquisition, reached BRL 9,140, over a 3% increase year-over-year. Starting with the undergraduate segment, medicine costs continue to show strong performance with a student-based increase of 14%.

This growth, in addition to the integration of Unidom and the ramp-up of four MICE medical campuses launched in the third quarter of 2022, contributed to a gross margin expansion for the segment. Additionally, as already mentioned, we completed the acquisition of FUNIC, which added 60 new medical seats to our portfolio, with operations starting the second semester of 2025, further strengthening our academic capacity and presence. The continuing education segment was marked by an increase in graduate journey students, in addition to a gross margin expansion driven by our ongoing operational restructuring, which continues to contribute to improving costs. In the medical practice solutions segment, growth was driven by clinical management payers, an increase of 10% year-over-year.

What went well
  • H1 2025 revenue reached BRL 1.856 billion, up 15% year-over-year, with Q2 revenue of BRL 919 million, up 14%
  • H1 adjusted EBITDA of BRL 893 million grew 20% with a 48.1% margin (+228 bps) - the highest first-half EBITDA margin since the 2019 IPO
  • Undergraduate medical students reached nearly 26,000 (+14%) and approved medical seats rose 14% to 3,653, including the FUNIC acquisition (60 new seats)
  • H1 net income climbed 17% to BRL 434 million and basic EPS rose 17% to BRL 4.69
  • Operating cash flow grew 15% to BRL 783 million (88.8% cash conversion); net debt fell BRL 194 million to BRL 1.621 billion, a low 0.97x net debt/EBITDA
  • Continuing education revenue rose 8% to BRL 138 million and medical practice solutions grew over 9% to BRL 84 million
What went wrong
  • Residency journey students fell 29% year-over-year to 9,224, reflecting a weak 2024 intake cycle
  • Medical practice monthly active users declined 9% to 230,000 versus the prior-year period
  • B2C medical practice revenue fell 8% to BRL 9 million year-over-year
  • Medical net average ticket grew only ~3.3% (BRL 9,140), below inflation, pressured by higher FIES discounts (27% discount)
  • Second-half medical intake faced more competition amid new seat approvals, with the candidate-to-seat ratio dropping from 7 to about 5

Guidance Changes

MetricPeriodCurrent guidance
Full-year 2025 revenue and adjusted EBITDAFY2025Reaffirmed, unchanged range; H2 kept conservative given continuing-education seasonality (new cohort warm-up after September)
Effective tax rateH2 2025 and long runExpected to converge toward the 15% OECD Pillar Two minimum in the long run

Performance Breakdown

MetricYoYNote
Q2 2025 revenue (BRL 919 million) +14% 3.2% increase in medical-course net average ticket, maturation of medical seats, and the Unidom acquisition
H1 2025 revenue (BRL 1.856 billion) +15% Steady expansion across undergrad and continuing education segments
Q2 2025 adjusted EBITDA (BRL 401 million, 43.6% margin) +17% Gross margin expansion plus SG&A efficiency; margin up 110 bps
H1 2025 adjusted EBITDA (BRL 893 million, 48.1% margin) +20% Gross margin gains in undergrad and continuing education, Unidom integration, MICE campus ramp-up, restructuring, and SG&A efficiency; margin up ~228 bps
Q2 2025 net income (BRL 177 million) +9% Strong operations partly offset by the new OECD Pillar Two tax legislation
H1 2025 net income (BRL 434 million) +17% Higher adjusted EBITDA flowing through to the bottom line
Undergraduate segment revenue (BRL 1.642 billion) +16% 14% student-base growth, Unidom integration, and MICE campus maturation; 86% from medicine, 94% from health-related courses
Continuing education revenue (BRL 138 million) +8% Graduate journey grew 12% to 9,055 students; other courses/B2B up 19%
Medical practice solutions revenue (BRL 84 million) +9% Clinical management payers up 10% and B2P revenue up ~12%; B2B revenue BRL 75 million (+12%)
Operating cash flow (BRL 783 million) +15% Robust operational performance; 88.8% cash conversion

Earnings Call Themes & Trends

TopicPrevious mentionCurrent periodTrend
Margin expansion via shared service center and SG&A efficiencyMajor team centralizations in continuing education and medical solutions began in 2024Additional centralization of undergraduate services into the shared service center; synergies still being captured across all three segments—
Operational leverage from maturing assets (MICE campuses, Unidom)Four MICE medical campuses launched in Q3 2022; Unidom (Salvador) acquired and integratingContinued maturation driving gross margin and bottom-line EBITDA margin expansion—
New share repurchase program—Board approved buyback of up to 4 million Class A shares (~4% of shares) through December 31, 2026, alongside dividends to lift EPS—
OECD Pillar Two taxation and Prouni risk—Working two fronts - a judicial protection filing (no outcome yet) and lobbying executive/legislature that Pillar Two withdraws Prouni benefits, affecting 10,000+ supported students—
M&A environment—Sellers pricing softening amid new-entity distress; location and reputation increasingly decisive for pricing; company pursues right profile at the right price—
ENAMED exam opportunity—Seen as a marginal-CapEx growth opportunity in continuing education (assets already in place), leveraging residency-prep content across B2C and B2B—

Q&A Summary

Itau BBA (Lucca Marquezini): Which segments drove the SG&A efficiency behind margin expansion, and is further dilution expected?
CFO said gains came from further centralizing undergraduate services into the shared service center, building on 2024 team centralizations in continuing education and medical solutions; CEO added that maturing MICE campuses and Unidom provide operational leverage as the top line grows.
Bank of America (Flavio Yoshida): With H1 EBITDA already near the top of the range, why no guidance revision - should H2 be below H1?
CEO said they prefer to stay conservative given continuing-education seasonality (the new cohort warms up after September) and remaining uncertainty, so they keep the same guidance range despite a successful undergraduate intake.
Bank of America (Flavio Yoshida): The effective tax rate is near 9%, below the 15% Pillar Two minimum - what should H2 look like?
CFO explained the low rate reflects recognition of deferred tax assets in Q1 and Q2; over the long run the effective rate is expected to converge toward the 15% Pillar Two level.
JPMorgan (Marcelo Santos): How was the competitive outlook for the second-half medical intake?
CEO noted many new seats and institutions were approved without a fresh high-school cohort, so competition was higher and the candidate-to-seat ratio fell from about 7 to 5; enrollment trends are good and occupancy remains at 100%.
JPMorgan (Marcelo Santos): Why did the medical ticket grow ~3.3%, below inflation?
CEO said gross tuition was raised slightly above inflation, but higher FIES discounts (a 27% discount, affecting roughly 10-15% of the base on some campuses) pulled the net ticket just below inflation.
JPMorgan (Marcelo Santos, follow-up): Did the more competitive second half require discounts?
CEO answered zero discounts - the same pricing policy was maintained.
BTG (Samuel Alves): Is the company more likely to challenge the new tax through legal or administrative means?
CFO said they are pursuing both: a judicial protection filing questioning how Pillar Two was defined/implemented (no outcome yet), and lobbying the executive and legislature that Pillar Two disqualifies Prouni credits (harming 10,000+ supported students); probability of success is hard to assign.
Morgan Stanley (Mauricio Cepeda): Is the M&A environment cheaper with sellers under pressure, and can Afya take advantage?
CFO said they always chase the right profile at the right price; with distressed new entities coming to market, good brand, reputation and location are increasingly decisive for pricing, and Afya can secure attractive assets accordingly.
Morgan Stanley (Mauricio Cepeda): The 4-million-share buyback is large versus free float and daily volume - how do you weigh returns versus liquidity?
CFO said the buyback (~4% of shares) combines with dividends to boost shareholder returns, allows opportunistic purchases on price, and lifts EPS over the long term; they will monitor short-term liquidity effects.
Citibank (Renan Prata): Why did the residency journey drop sharply, and does ENAMED require additional CapEx?
CEO attributed the decline to a weak 2024 intake cycle in a highly competitive residency market, with the main seasonal intake still ahead (September); ENAMED requires only marginal CapEx since assets and curriculum are already in place, offering a B2C and B2B opportunity.

More on Afya Ltd

Reported 2025-08-13 · figures from the Afya Ltd Q2 2025 earnings call.

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