Totvs stock: Q3 revenue reaches BRL 2 billion as profit slips

Published on 11/06/2026 at 00:30 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWS

Totvs stock enters the third-quarter results cycle with stronger recurring sales. Higher financial costs weighed on adjusted earnings.

Third-quarter growth meets financial pressure

TOTVS reported double-digit organic revenue growth for a 31st consecutive quarter.
Higher financial expenses and credit provisions weighed on adjusted profitability despite operating leverage.

Totvs, BRTOTSACNOR8, Illustration mit AI erstellt.

TOTVS reported third-quarter 2026 results on Wednesday, November 4, showing continued expansion in its software business but weaker adjusted profitability. According to the TOTVS earnings release, net revenue rose 13.2 percent year over year to BRL 1.978 billion.

Revenue growth remains broad-based

Recurring revenue increased 15.1 percent to BRL 1.837 billion and represented 92.9 percent of total revenue. Annual recurring revenue reached BRL 7.951 billion, up 13.7 percent from the year-earlier quarter.

The company said the quarter marked its 31st consecutive period of double-digit organic revenue growth. Cloud growth accelerated to 31 percent year over year, while artificial-intelligence enablers accounted for 14.9 percent of recurring revenue. Net annual recurring revenue additions reached BRL 209 million.

Margins rise as profit comes under pressure

Adjusted EBITDA increased 16.9 percent to BRL 500.9 million, lifting the adjusted EBITDA margin to 25.3 percent from 24.5 percent a year earlier. TOTVS attributed the improvement to operating leverage, cost control and internal productivity gains.

Adjusted net income moved in the opposite direction, falling 8.8 percent to BRL 237.2 million. The adjusted net margin declined to 12.0 percent from 14.9 percent, primarily because financial expenses rose following the debt raised to fund the Linx acquisition and the reduction in invested cash after share buybacks.

Credit cycle tests Techfin expansion

Techfin credit production rose 2.1 percent to BRL 3.465 billion, while Pix transaction volume advanced 27.7 percent to BRL 3.047 billion. The unit reported adjusted EBITDA of BRL 1.4 million, compared with a loss of BRL 5.0 million in the second quarter.

Credit provisions increased 87.2 percent year over year in the Techfin operation. Management said the company is applying a more conservative underwriting approach as Brazil's credit environment remains challenging; delinquency above 90 days stood at 2.9 percent.

What investors will watch next

The next quarterly updates will show whether cloud demand and AI-enabled products can sustain recurring-revenue growth while higher financing costs and credit provisions ease. Free cash flow to the firm fell 24.9 percent year over year in the quarter to BRL 192.8 million, partly because of upfront payments for cloud contracts, although the nine-month figure increased 19.6 percent.