Afya Limited Announces First-Quarter 2026 Financial Results

Afya Limited Announces First-Quarter 2026 Financial Results BELO HORIZONTE, Brazil--( BUSINESS WIRE)--Afya Limited (Nasdaq: AFYA; B3: A2FY34) (“Afya” or the “Company”), the leading medical education group and medical practice solutions provider in Brazil, reported today its financial and operating results for the first quarter and three-month period ended March 31, 2026. Financial results are expressed in Brazilian Reais and are presented in accordance with International Financial Reporting Standards (IFRS).

First Quarter 2026 Highlights

2026

2025

% Chg

1,012,712

1,008,373

936,360

8.2%

7.7%

511,419

510,352

491,971

4.0%

3.7%

50.5%

50.6%

52.5%

261,763

257,036

1.8%

2.88

2.79

3.0%

Message from Management

We begin 2026 with another quarter of solid execution, reflecting the consistency of our operating model and our ability to combine growth and cash generation while continuing to invest in Afya’s long-term strategic priorities. In the first quarter, our performance was once again supported by the strength of our Undergraduate segment, disciplined capital allocation and continued progress in expanding our physician-centric ecosystem.

During the quarter, we completed another successful intake cycle across our medical schools, maintaining 100% occupancy and achieving a 4.6% YoY increase in Medical School net average ticket, excluding acquisitions. This performance was supported by the strength of our academic offering, the effectiveness of our unified intake process, and the continued recognition of the Afya brand across Brazil. Revenue growth in the period also benefited from the continued maturation of medical seats and the contribution from recent seat authorization, and the acquisition of FUNIC. Our integrated model remains a key differentiator, helping us attract students and sustain efficient growth across our campuses

In Continuing Education and Medical Practice Solutions, we continued to advance the next phase of our strategy during the quarter. Both segments reflected higher investment levels, mainly in SG&A, product development and engagement initiatives. These investments are part of a broader strategic cycle aimed at strengthening Afya’s ecosystem and unlocking scalable long-term monetization. As our audience and engagement expand, we also reinforce our data advantage, improve users' experience, and build stronger foundations for future B2P and B2B opportunities. At the same time, this more integrated ecosystem continues to support a structurally low customer acquisition cost in Undergraduate, reinforcing an important competitive advantage of our business model. In Continuing Education, this progress was reflected in the growth of Graduate Journey students and B2P revenue growth. In Medical Practice Solutions, we highlight the increase in Clinical Management active payers, together with B2B revenue growth

Our capital allocation remained disciplined throughout the quarter. We further reduced leverage, reinforcing the quality of our capital structure while advancing our strategic priorities and returning value to shareholders. Consistent with this approach, we continued to execute our share repurchase program authorized in 2025, which provides for the repurchase of up to 4,000,000 Class A common shares through December 31, 2026. Since the launch of the program, we have already repurchased over 50% of the total amount authorized. In addition, in March 2026, our Board of Directors approved a cash dividend of R$307.4 million, equivalent to 40% of Afya’s 2025 consolidated net income, corresponding to a dividend amount of US$0.656489 per share. Taken together, these actions underscore our commitment to prudent capital allocation, shareholder remuneration, and long-term value creation.

Looking ahead, we remain focused on executing with consistency, strengthening our ecosystem, and reinforcing Afya’s role as the partner of choice for physicians in Brazil. We believe that our disciplined investment cycle, combined with the strength of our balance sheet, positions us well to deepen engagement across the physician journey, support sustainable growth, and create long-term value for our shareholders.

1. Key Events in the Quarter

As Afya Cametá—an approved but, non-operating medical school—and Afya Abaetetuba are located within the same health region, Afya Cametá will not become operational, thereby creating the capacity that enabled the approval of 63 additional medical seats at Afya Abaetetuba. With this addition, Afya now has a total of 3,768 approved medical seats across its portfolio.

2. Subsequent Events

3. 2026 Guidance

The Company is reaffirming its 2026 guidance, which assumes the successful acceptance of new students for the first semester of 2026. The guidance for 2026 is defined in the following table:

4. 1Q26 Overview

Segment Information

The Company has three reportable segments as follows:

Undergraduate, previously denominated Undergrad, which provides educational services through undergraduate courses related to medical school, undergraduate health science and other ex-health undergraduate programs;

Continuing education, which provides medical education (including residency preparation programs, specialization test preparation and other medical capabilities), specialization and graduate courses in medicine, delivered through digital and in-person content; and

Medical practice solutions, which provides clinical decision, clinical management and doctor-patient relationships for physicians and provide access, demand and efficiency for the healthcare players.

Key Revenue Drivers – Undergraduate Programs

2026

2025

% Chg

3,768

3,543

6.4

26,494

25,879

2.4

26,494

25,879

2.4

26,352

25,879

1.8

765,925

714,713

7.2

761,596

714,713

6.6

9,634

9,206

4.6

31,088

26,134

19.0

31,088

26,134

19.0

31,087

26,134

19.0

70,745

62,811

12.6

70,736

62,811

12.6

39,358

34,995

12.5

39,358

34,995

12.5

39,358

34,995

12.5

55,795

49,848

11.9

55,795

49,848

11.9

892,465

827,372

7.9

888,127

827,372

7.3

Key Revenue Drivers – Continuing Education

2026

2025

% Chg

9,744

12,203

-20.2

9,855

8,542

15.4

36,932

26,164

41.2

56,531

46,909

20.5

74,083

65,444

13.2

4,862

5,660

-14.1

78,946

71,103

11.0

Key Revenue – Medical Practice Solutions

2026

2025

% Chg

154,101

163,071

-5.5

46,707

40,324

15.8

200,808

203,395

-1.3

220,528

244,518

-9.8

38,216

37,231

2.6

5,210

4,453

17.0

43,425

41,684

4.2

Key Operational Drivers – Users Positively Impacted by Afya

The Users Positively Impacted by Afya represents the total number of medical students from the Undergraduate segment, students from Continuing Education and users from Medical Practice Solutions. For the first quarter of 2026, Afya’s ecosystem reached 303,553 users.

1Q26

1Q25

% Chg YoY

4Q25

3Q25

2Q25

26,494

25,879

2.4

25,556

25,706

25,733

56,531

46,909

20.5

55,039

50,317

45,505

220,528

244,518

-9.8

220,051

227,941

230,468

303,553

317,306

-4.3

300,646

303,964

301,706

Revenue

Revenue for the first quarter of 2026 was R$1,012.7 million, an increase of 8.2% over the same period in the prior year. Excluding acquisitions, Revenue for the three-month period increased by 7.7% YoY to R$1,008.4 million.

The quarter revenue increase was mainly due to higher tickets in medicine courses, the increase in non-medical undergraduate students, the acquisition of FUNIC, and the advancement of the Continuing Education Segment.

2026

2026 Ex

Acquisitions*

2025

% Chg

% Chg Ex

Acquisitions

892,465

888,127

827,372

7.9

7.3

78,946

71,103

11.0

43,425

41,684

4.2

(2,124

)

(2,124

)

(3,799

)

-44.1

1,012,712

1,008,373

936,360

8.2

7.7

Adjusted EBITDA

Adjusted EBITDA for the first quarter of 2026 increased by 4.0% to R$511.4 million, up from R$492.0 million in the same period of the prior year, with the Adjusted EBITDA Margin reducing by -200 basis points to 50.5%.

The reduction in Adjusted EBITDA Margin was primarily driven by higher costs and expenses in the Continuing Education and Medical Practice Solutions segments, mainly reflecting (a) lower gross margin compared with the first quarter of 2025; and (b) higher payroll, sales, and marketing expenses associated with the ongoing investment cycle in both segments.

2026

2025

% Chg

261,763

257,036

1.8%

94,350

94,994

-0.7%

42,454

24,782

71.3%

93,077

91,755

1.4%

13,547

14,532

-6.8%

(4,967)

(4,285)

15.9%

11,149

6,963

60.1%

6,194

-99.3%

5,970

124

283.3%

511,419

491,971

4.0%

50.5%

52.5%

Net Income

Net Income for the first quarter of 2026 totaled R$261.8 million, representing a 1.8% YoY increase. This growth reflects stronger operating performance, partially offset by an additional CSLL provision related to the OECD’s Pillar Two global minimum tax.

Basic EPS for the three-month period ended March 31, 2026, reached R$2.88. An increase of 3.0% YoY, reflecting the higher Net Income and our capital allocation strategy.

2026

2025

% Chg

261,763

257,036

1.8%

2.88

2.79

3.0%

Cash and Debt Position

As of March 31, 2026, Cash and Cash Equivalents totaled R$1,332.9 million, representing a 15.4% increase from March 31, 2025. Afya reduced its Net Debt, excluding the effect of IFRS 16, to R$1,151.3 million, a decrease of R$372.8 million compared to March 31, 2025. This reduction was achieved through solid Cash Flow from Operating Activities, despite the business combination with FUNIC, dividend payment, and Afya’s ongoing share repurchase program.

For the three-month period ended March 31, 2026, Afya generated R$473.2 million in Cash Flow from Operating Activities, up from R$470.2 million in the same period of the previous year, an increase of 0.6% YoY. The Operating Cash Conversion Ratio reached 92.5%.

2026

2025

% Chg

466,796

463,850

0.6%

6,357

6,386

-0.5%

473,153

470,236

0.6%

511,419

491,971

4.0%

6,194

-99.3%

5,970

-100.0%

124

-100.0%

283.3%

511,373

485,777

5.3%

92.5%

96.8%

The following table shows more information regarding the cost of debt for 2026, considering loans and financing and accounts payable to selling shareholders. Afya’s capital structure remains solid, with a conservative leveraging position and a low cost of debt. Afya’s Net Debt (excluding the effect of IFRS16) divided by Adjusted EBITDA mid guidance is 0.7x, marking an impressive reduction from 0.9x in the same period of the prior year, reinforcing Afya’s accelerated deleveraging trend.

2026

2025

2026

2025

2026

2025

2026

2025

850

1.1

8.6

1,594

513

3.9

2.3

15.5

14.6

106

115

328

0.5

14.7

115

530

522

2.8

3.6

15.8

14.0

108

110

360

466

4.2

3.6

14.6

12.7

100

2,484

2,679

3.7

2.2

15.4

12.2

105

1Q26

FY2025

% Chg

1Q25

% Chg

1,332,866

1,125,381

18.4

1,154,888

15.4

25,796

15,470

66.7

3,508

635.3

1,307,070

1,109,911

17.8

1,151,380

13.5

2,124,512

2,054,267

3.4

2,212,674

-4.0

132,099

60,668

117.7

373,275

-64.6

1,992,413

1,993,599

-0.1

1,839,399

8.3

359,667

440,597

-18.4

466,341

-22.9

57,325

110,640

-48.2

191,698

-70.1

302,342

329,957

-8.4

274,643

10.1

n.a.

1,151,313

1,369,483

-15.9

1,524,127

-24.5

1,077,075

1,065,746

1.1

989,184

8.9

55,478

55,772

-0.5

47,762

16.2

1,021,597

1,009,974

1.2

941,422

8.5

2,228,388

2,435,229

-8.5

2,513,311

-11.3

CAPEX

Capital expenditure consists of the purchase of property and equipment and intangible assets, including expenditure mainly related to the expansion and maintenance of Afya’s campuses and headquarters, leasehold improvements, and the development of new solutions in Medical Practice Solutions and content in Continuing Education.

For the three-month period ended March 31, 2026, CAPEX totaled R$44.8 million, representing 4.4% of Afya’s Net Revenue, including an acceleration in intangible investments in the first quarter associated with the ongoing investment cycle in Continuing Education and Medical Practice Solutions.

2026

2025

% Chg

12,762

38,477

-66.8

32,016

17,735

80.5

44,778

56,212

-20.3

4.4

6.0

5. Conference Call and Webcast Information

When:

Who:

Mr. Virgilio Gibbon, Chief Executive Officer

Mr. Luis André Blanco, Chief Financial Officer

Ms. Renata Costa Couto, IR Director

https://afya.zoom.us/j/98271618661

Dial-in:

Brazil: +55 21 3958 7888 or +55 11 4632 2236 or +55 11 4632 2237 or +55 11 4680 6788 or +55 11 4700 9668.

United States: +1 346 248 7799 or +1 360 209 5623 or +1 386 347 5053 or +1 507 473 4847 or +1 564 217 2000 or +1 646 931 3860 or +1 669 444 9171 or +1 669 900 6833 or +1 689 278 1000 or +1 719 359 4580 or +1 929 205 6099 or +1 253 205 0468 or +1 253 215 8782 or +1 301 715 8592 or +1 305 224 1968 or +1 309 205 3325 or +1 312 626 6799.

Webinar ID: 982 7161 8661

Other Numbers: https://afya.zoom.us/u/aRK0ROGaH

6. About Afya Limited (Nasdaq: AFYA; B3: A2FY34)

Afya is a leading medical education group in Brazil based on the number of medical school seats, delivering an end-to-end physician-centric ecosystem that serves and empowers students and physicians to transform their ambitions into rewarding lifelong experiences from the moment they join us as medical students through their medical residency preparation, graduation program, continuing medical education activities and offering medical practice solutions to help doctors enhance their healthcare services through their whole career. For more information, please visit www.afya.com.br.

7. Forward – Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. All statements other than statements of historical fact could be deemed forward-looking, including risks and uncertainties related to statements about our competition; our ability to attract, upsell and retain students; our capacity to increase tuition prices; our ability to anticipate and meet the evolving needs of students and teachers; our capacity to source and successfully integrate acquisitions; as well as general market, political, economic, and business conditions. Additionally, these statements include financial targets such as revenue, share count and IFRS and non-IFRS financial measures including gross margin, operating margin, net income (loss) per diluted share, and free cash flow. These statements are not guarantees of future performance and undue reliance should not be placed on them.

The Company assumes no obligation to update any forward-looking statements made in this press release to reflect events or circumstances occurring after its publication, nor to incorporate new information or the occurrence of unanticipated events, except as required by law. The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any of these risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from those expressed or implied by the forward-looking statements we make.

Readers should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent management’s beliefs and assumptions only as of the date they are made. Further information on these and other factors that could affect the Company’s financial results is included in filings made with the United States Securities and Exchange Commission (SEC) from time to time, including the section titled “Risk Factors” in the most recent annual report on Form 20-F. These documents are available in the SEC Filings section of the investor relations section of our website at: https://ir.afya.com.br/.

8. Non-GAAP Financial Measures

To supplement the Company's consolidated financial statements, which are prepared and presented in accordance with IFRS accounting standards as issued by the International Accounting Standards Board—IASB, Afya presents Adjusted EBITDA and Operating Cash Conversion Ratio which are non-GAAP financial measures, for the convenience of investors. A non-GAAP financial measure is generally defined as one that intends to measure financial performance but excludes or includes amounts that would not be equally adjusted in the most comparable GAAP measure.

Afya calculates Adjusted EBITDA as net income plus/minus net financial result, plus income taxes expense, plus depreciation and amortization, plus interest received on late payments of monthly tuition fees, plus share-based compensation, plus/minus income share associate, plus/minus non-recurring expenses/income. Operating Cash Conversion Ratio is calculated as the Cash flow from Operating Activities plus income taxes paid, minus/plus non-recurring expenses/income divided by Adjusted EBITDA.

The non-GAAP supplemental financial measures are provided with the intend to help investors in assessing the overall performance of Afya’s business regarding its core operations, cash generation and profitability. The non-GAAP financial measures described in this release are not substitutes for the IFRS measures. In addition, the calculations of Adjusted EBITDA and Operating Cash Conversion Ratio are not standardized financial measures and may differ from the calculations used by other companies, including competitors in the education services industry, and therefore, Afya’s measures may not be comparable to those of other companies.

9. Investor Relations Contact

E-mail: ir@afya.com.br

10. Financial Tables

Unaudited interim condensed consolidated statements of financial position

As of March 31, 2026 and December 31, 2025

(In thousands of Brazilian reais)

March 31, 2026

December 31, 2025

Assets

(unaudited)

Current assets

Cash and cash equivalents

1,332,866

1,125,381

Trade receivables

777,975

717,373

Recoverable taxes

21,572

13,429

Income taxes recoverable

25,833

23,046

Other assets

66,179

62,947

Total current assets

2,224,425

1,942,176

Non-current assets

Trade receivables

41,567

34,985

Deferred tax assets

4,676

12,552

Other assets

129,553

125,480

Investment in associate

50,607

46,518

Property and equipment

699,016

711,485

Right-of-use assets

902,538

896,758

Intangible assets

5,573,118

5,587,980

Total non-current assets

7,401,075

7,415,758

Total assets

9,625,500

9,357,934

Liabilities

Current liabilities

Trade payables

134,138

123,581

Loans and financing

132,099

60,668

Lease liabilities

55,478

55,772

Accounts payable to selling shareholders

57,325

110,640

Advances from customers

151,115

158,035

Dividends payable

308,332

192

Labor and social obligations

245,680

217,526

Taxes payable

37,385

36,043

Income taxes payable

117,657

112,638

Other liabilities

7,758

8,946

Total current liabilities

1,246,967

884,041

Non-current liabilities

Loans and financing

1,992,413

1,993,599

Lease liabilities

1,021,597

1,009,974

Accounts payable to selling shareholders

302,342

329,957

Taxes payable

74,459

77,487

Income taxes payable

26,358

Provision for legal proceedings

131,832

128,220

Other liabilities

42,985

43,471

Total non-current liabilities

3,591,986

3,582,708

Total liabilities

4,838,953

4,466,749

Equity

Share capital

Additional paid-in capital

2,319,509

2,320,422

Treasury shares

(372,786)

(306,010)

Share-based compensation reserve

213,964

202,815

Retained earnings

2,584,194

2,634,552

Equity attributable to the owners of the Company

4,744,898

4,851,796

Non-controlling interests

41,649

39,389

Total equity

4,786,547

4,891,185

Total liabilities and equity

9,625,500

9,357,934

Unaudited interim condensed consolidated statements of income and comprehensive income

For the three-month periods ended March 31, 2026 and 2025

(In thousands of Brazilian reais, except for earnings per share information)

March 31, 2026

March 31, 2025

(unaudited)

Revenue

1,012,712

936,360

Cost of services

(314,649

)

(282,639

)

Gross profit

698,063

653,721

Selling, general and administrative expenses

(287,661

)

(264,942

)

Allowance for expected credit losses

(17,843

)

(16,558

)

Other income

4,871

2,506

Other expenses

(3,830

)

(2,200

)

Operating income

393,600

372,527

Finance income

53,297

43,481

Finance expenses

(147,647

)

(138,475

)

Net finance result

(94,350

)

(94,994

)

Share of profit of equity-accounted investee, net of tax

4,967

4,285

Income before income taxes

304,217

281,818

Income taxes expenses

Current

(34,578

)

(31,928

)

Deferred

(7,876

)

7,146

Net income

261,763

257,036

Other comprehensive income

Total comprehensive income

261,763

257,036

Net income / total comprehensive income attributable to:

Owners of the Company

257,019

251,999

Non-controlling interests

4,744

5,037

261,763

257,036

Basic earnings per common share

2.88

2.79

Diluted earnings per common share

2.85

2.76

Unaudited interim condensed consolidated statements of cash flows

For the three-month periods ended March 31, 2026 and 2025

(In thousands of Brazilian reais)

March 31, 2026

March 31, 2025

(unaudited)

Operating activities

Income before income taxes

304,217

281,818

Adjustments to reconcile income before income taxes

Depreciation and amortization expenses

93,077

91,755

Write-off of property and equipment

362

305

Allowance for expected credit losses

17,843

16,558

Share-based compensation expenses

11,149

6,963

Net foreign exchange differences

893

476

Accrued interest

86,895

76,939

Accrued interest on lease liabilities

30,211

29,563

Share of profit of equity-accounted investee, net of tax

(4,967

)

(4,285

)

Provision (reversal) for legal proceedings

5,409

408

Changes in assets and liabilities

Trade receivables

(85,027

)

(55,632

)

Recoverable taxes

(10,930

)

(6,392

)

Other assets

(6,965

)

(6,131

)

Trade payables

10,557

1,893

Taxes payable

1,362

10,787

Advances from customers

(6,920

)

214

Labor and social obligations

28,154

29,774

Provision for legal proceedings

(1,259

)

Other liabilities

(908

)

(4,777

)

473,153

470,236

Income taxes paid

(6,357

)

(6,386

)

Net cash flows from operating activities

466,796

463,850

Investing activities

Acquisition of property and equipment

(12,762

)

(38,477

)

Acquisition of intangibles assets

(32,016

)

(17,735

)

Dividends received

5,598

Acquisition of assets and subsidiaries, net of cash acquired

(65,005

)

(65,162

)

Payments of interest

(14,536

)

Net cash flows used in investing activities

(109,783

)

(130,312

)

Financing activities

Payments of principal of loans and financing

(5,254

)

(769

)

Payments of interest

(28,087

)

(44,980

)

Payments of principal of lease liabilities

(13,792

)

(11,904

)

Payments of interest of lease liabilities

(32,200

)

(29,167

)

Treasury shares repurchase

(69,511

)

Proceeds from exercise of stock options

1,930

1,622

Dividends paid

(1,721

)

(3,991

)

Net cash flows from (used in) financing activities

(148,635

)

(89,189

)

Net foreign exchange differences

(893

)

(476

)

Net increase (decrease) in cash and cash equivalents

207,485

243,873

Cash and cash equivalents at the beginning of the period

1,125,381

911,015

Cash and cash equivalents at the end of the period

1,332,866

1,154,888