Q3 2025 Ambev SA Earnings Call

October 30, 2025

Speaker #1: 50 basis points of margin expansion . Normal group 8% . Other than the photo in a year to date perspective , we are positive about the decisions we have made and the resilience of our business supported by the strength of our brands and our solid market share .

Lisboa: 50 basis points of margin expansion while normalized EPS grew 8%. Looking at the film rather than the photo, in a year-to-date perspective, we are positive about the decisions we have made and the resilience of our business. Supported by the strength of our brands and our solid market share, top line grew 4%, driven by a healthy net revenue per hectoliter of 7%, which led to a EBITDA growth of over 7% with 120 basis points of margin expansion. Cost initiatives continue to make a difference, with cash COGS per hectoliter growing below net revenue per hectoliter and normalized EPS grew above 7%.

Carlos Lisboa: 50 basis points of margin expansion while normalized EPS grew 8%. Looking at the film rather than the photo, in a year-to-date perspective, we are positive about the decisions we have made and the resilience of our business. Supported by the strength of our brands and our solid market share, top line grew 4%, driven by a healthy net revenue per hectoliter of 7%, which led to a EBITDA growth of over 7% with 120 basis points of margin expansion. Cost initiatives continue to make a difference, with cash COGS per hectoliter growing below net revenue per hectoliter and normalized EPS grew above 7%.

Speaker #1: Top line grew 4%, driven by 7%, which led to EBITDA growth of over 7% with 120 basis points of margin expansion.

Speaker #1: Cost initiatives continue to make a difference , with cash costs per activity growing below net revenue per hectoliter and normalised EPs grew above 7% following our capital allocation strategy and confident on our long term value creation potential .

Speaker #1: On October 29th, the Board of Directors approved a $2.5 billion share buyback program, with the main purpose of canceling shares as a way to return cash to shareholders.

Lisboa: Confident on our long-term value creation potential, on 29th October, the board of directors approved a BRL 2.5 billion share buyback program with the main purpose of canceling shares as a way to return cash to shareholders. Behind these results lie in the foundations of our growth strategy. Starting with pillar 1, lead and grow the category. To be a true category captain, we must place our customers and consumers at the center of our decision-making process, being able to better understand and serve the demand, a capability that becomes even more important when the trading environment turn more dynamic, allowing us to, 1, lead the beer category. Our core brands remain resilient. Even though volumes decline, it strengthened and continued to grow in volumes more than 9%. Number 2, shape new avenues of growth.

Carlos Lisboa: Confident on our long-term value creation potential, on 29th October, the board of directors approved a BRL 2.5 billion share buyback program with the main purpose of canceling shares as a way to return cash to shareholders. Behind these results lie in the foundations of our growth strategy. Starting with pillar 1, lead and grow the category. To be a true category captain, we must place our customers and consumers at the center of our decision-making process, being able to better understand and serve the demand, a capability that becomes even more important when the trading environment turn more dynamic, allowing us to, 1, lead the beer category. Our core brands remain resilient. Even though volumes decline, it strengthened and continued to grow in volumes more than 9%. Number 2, shape new avenues of growth.

Speaker #1: Behind this results line , the foundations of our growth strategy , starting with pillar number one , lead and growth . The category to be a true category captain .

Speaker #1: We must place our customers and consumers at the center of our decision making process . Being able to better understand and serve the demand .

Speaker #1: A capability that becomes even more important when the operating environment turns more dynamic, allowing us to, number one, lead the beer category.

Speaker #1: Our core brand .

Speaker #2: Growth .

Speaker #1: 6% , including alcohol . Beers growing above 20% continue to expand ahead of the company's volume as leaders , we continue to develop the category aiming not only to sell more , but to expand the consumer base and the number of occasions over the long term .

Lisboa: 26%, including no alcohol beers growing above 20%, continue to expand ahead of the company's volume. As leaders, we continue to develop the category, aiming not only to sell more but to expand the consumer base and the number of occasions over the long term, ultimately creating sustainable value. As for pillar two, digitize and monetize the ecosystem. This pillar continues to be instrumental to our business. It provides valuable insights into our consumer, customers, and operations while expanding our addressable market. The Q3 marked another solid step towards making our digital ecosystem a competitive advantage for our company. When it comes to new growth engines, BEES Marketplace maintain its strong momentum, with GMV growing 100% to an annualized BRL 8 billion, driven by the expansion of our commercial partnerships.

Carlos Lisboa: 26%, including no alcohol beers growing above 20%, continue to expand ahead of the company's volume. As leaders, we continue to develop the category, aiming not only to sell more but to expand the consumer base and the number of occasions over the long term, ultimately creating sustainable value. As for pillar two, digitize and monetize the ecosystem. This pillar continues to be instrumental to our business. It provides valuable insights into our consumer, customers, and operations while expanding our addressable market. The Q3 marked another solid step towards making our digital ecosystem a competitive advantage for our company. When it comes to new growth engines, BEES Marketplace maintain its strong momentum, with GMV growing 100% to an annualized BRL 8 billion, driven by the expansion of our commercial partnerships.

Speaker #1: Ultimately creating sustainable value . As for pillar two , digitize and monetize the ecosystem , this pillar continues to be instrumental to our business .

Speaker #1: It provides valuable insights into our consumer , customers and operations . While expanding our addressable market . The third quarter marked another solid step towards making our digital ecosystem a competitive advantage for our company .

Speaker #1: When it comes to new growth engines, these marketplaces maintain their strong momentum, with GMV growing 100% to an annualized R$8 billion, driven by the expansion of our commercial partnerships.

Speaker #1: Meanwhile , on the direct to consumer front , Z delivered recorded a 7% increase in GMV , even amid a softer industry supported by a 9% rise in average order value .

Lisboa: Meanwhile, on the direct-to-consumer front, Zé Delivery recorded a 7% increase in GMV, even amid a softer industry, supported by a 9% rise in average order value. In revenue management, BEES continues to enable a more assertive and data-driven decisions. With a more granular view of elasticity by brand, pack, and customer, we can optimize our discounts and promotions to improve the return on every BRL invested. For example, this quarter in Brazil, we increased the number of SKUs per pack in 5% and improved by 30% the return on promotions. In cost and expenses management, BEES also play a key role in the SKU optimization program we mentioned last quarter. It help us expand the distribution of our main SKUs, improving production efficiency while ensuring that our customers continue to find the right portfolio for their businesses.

Carlos Lisboa: Meanwhile, on the direct-to-consumer front, Zé Delivery recorded a 7% increase in GMV, even amid a softer industry, supported by a 9% rise in average order value. In revenue management, BEES continues to enable a more assertive and data-driven decisions. With a more granular view of elasticity by brand, pack, and customer, we can optimize our discounts and promotions to improve the return on every BRL invested. For example, this quarter in Brazil, we increased the number of SKUs per pack in 5% and improved by 30% the return on promotions. In cost and expenses management, BEES also play a key role in the SKU optimization program we mentioned last quarter. It help us expand the distribution of our main SKUs, improving production efficiency while ensuring that our customers continue to find the right portfolio for their businesses.

Speaker #1: In revenue management , bees continues to enable a more assertive and data driven decisions with a more granular view of elasticity by brand , pack and customer .

Speaker #1: We can optimize our discounts and promotions to improve the return on every hell invested . For example , this quarter in Brazil , we increased the number of SKUs per pack in 5% and improved by 30% .

Speaker #1: The return on promotions and in cost and expenses management. Bees also play a key role in the skew optimization program. We mentioned that last quarter.

Speaker #1: It helped us expand the distribution of our main SKUs, improving production efficiency while ensuring that our customers continue to support their businesses.

Speaker #1: In summary , the combined impact of the revenue and cost management led to an expansion of our gross margin in the quarter . Speaking of cost performance , let's move into pillar number three .

Speaker #1: Optimize our business . This year we have been emphasizing our disciplined approach to costs , and this quarter , clearly shows why it matters why we expected costs to continue to accelerate , driven by effects , commodities and operational deleverage from lower volumes .

Lisboa: In summary, the combined impact of the revenue and cost management led to an expansion of our gross margin in the quarter. Speaking of cost performance, let's move into pillar number 3, optimize our business. This year, we have been emphasizing our disciplined approach to costs. This quarter clearly shows why it matters. While we expected costs to continue to accelerate, driven by FX, commodities, and the operational deleverage from lower volumes, our efficiency efforts paid off. We managed to keep costs mostly in line with previous quarter, freeing up resources to continue investing in the long-term growth of our business. Looking ahead, there's still work to be done as we pursue the lower half of our Brazil beer cash COGS per hectoliter guidance, which will support our ambition of protecting consolidated EBITDA margins in the full year.

Carlos Lisboa: In summary, the combined impact of the revenue and cost management led to an expansion of our gross margin in the quarter. Speaking of cost performance, let's move into pillar number 3, optimize our business. This year, we have been emphasizing our disciplined approach to costs. This quarter clearly shows why it matters. While we expected costs to continue to accelerate, driven by FX, commodities, and the operational deleverage from lower volumes, our efficiency efforts paid off. We managed to keep costs mostly in line with previous quarter, freeing up resources to continue investing in the long-term growth of our business. Looking ahead, there's still work to be done as we pursue the lower half of our Brazil beer cash COGS per hectoliter guidance, which will support our ambition of protecting consolidated EBITDA margins in the full year.

Speaker #1: Our efficiency efforts paid off. We managed to keep costs mostly in line with the previous quarter, freeing up resources to continue investing in the long-term growth of our business.

Speaker #1: Looking ahead , there is still work to be done as we pursue the lower half of our Brazil beer . Cash cogs per hectoliter guidance , which will support our ambition of protecting consolidated EBITDA margins in the full year .

Speaker #1: Speaking of margins , our disciplined approach to revenue , cost and expense management owns again delivered results . Four of our business units .

Speaker #1: Expanded EBITDA margins and all of them delivered . Growing or flat EBITDA consistent with the last two quarters . Now let's turn to the commercial highlights from our main markets , starting with Brazil beer .

Lisboa: Speaking of margins, our disciplined approach to revenue, cost, and expense management once again delivered results. Four of our business units expanded EBITDA margins, and all of them delivered growing or flat EBITDA consistent with the last two quarters. Now, let's turn to the commercial highlights from our main markets. Starting with Brazil beer. This was the second consecutive quarter of industry softness. It is understandable that this can raise some concerns about the category's prospects. Before we go into our business performance, I would like to take a moment to share a few insights into what we see as situational factors, meaning either short-term or cyclical and structural factors that may impact the industry over time. Over the past two quarters, the beer category equity has improved, which is a good proxy for future share of throat, while consumers' participation in beer remains stable.

Carlos Lisboa: Speaking of margins, our disciplined approach to revenue, cost, and expense management once again delivered results. Four of our business units expanded EBITDA margins, and all of them delivered growing or flat EBITDA consistent with the last two quarters. Now, let's turn to the commercial highlights from our main markets. Starting with Brazil beer. This was the second consecutive quarter of industry softness. It is understandable that this can raise some concerns about the category's prospects. Before we go into our business performance, I would like to take a moment to share a few insights into what we see as situational factors, meaning either short-term or cyclical and structural factors that may impact the industry over time. Over the past two quarters, the beer category equity has improved, which is a good proxy for future share of throat, while consumers' participation in beer remains stable.

Speaker #1: This was the second consecutive quarter of industry softness . It is understandable that this can raise some concerns about the categories , prospects .

Speaker #1: So before we go into our business performance , I would like to take a moment to share a few insights into what we see as situational factors .

Speaker #1: Meaning either short term or cyclical and structural factors that may impact the industry over time . Over the past two quarters , the beer category equity has improved , which is a good proxy for future share of throat .

Speaker #1: While consumer participation in beer remains stable, this reinforces our view that there are no meaningful short-term structural changes in consumer behavior toward the category.

Speaker #1: The industry decline was mostly related to fewer consumption occasions , particularly in the on trade channel , which was affected by two main factors .

Lisboa: This reinforces our view that there are no meaningful short-term structural changes in consumer behavior toward the category. The industry's decline was mostly related to fewer consumption occasions, particularly in the on-trade channel, which was affected by two main factors. Number one, weather. The past six months were colder than normal, especially in the south and southeast off a tough comp as 2023 and 2024 were the two warmest winters on record. This impact, according to our estimates, represent approximately 70% of the industry decline. Number two, consumer purchasing power. The macro environment, particularly in the north and northeast, continued to constrain discretionary spending. These are situational drivers for their short-term or cyclical nature, underpinning our confidence in the long-term fundamentals of both the category and our portfolio. That said, let me share three potential trends and needs that can turn into structural drivers.

Carlos Lisboa: This reinforces our view that there are no meaningful short-term structural changes in consumer behavior toward the category. The industry's decline was mostly related to fewer consumption occasions, particularly in the on-trade channel, which was affected by two main factors. Number one, weather. The past six months were colder than normal, especially in the south and southeast off a tough comp as 2023 and 2024 were the two warmest winters on record. This impact, according to our estimates, represent approximately 70% of the industry decline. Number two, consumer purchasing power. The macro environment, particularly in the north and northeast, continued to constrain discretionary spending. These are situational drivers for their short-term or cyclical nature, underpinning our confidence in the long-term fundamentals of both the category and our portfolio. That said, let me share three potential trends and needs that can turn into structural drivers.

Speaker #1: Number one , weather . The past six months were colder than normal , especially in the south , and southeast of a tough comp .

Speaker #1: As 2023 and 2024 were the two warmest winters on record . This impact , according to our estimates , represent approximately 70% of the industry decline in number two consumer purchasing power .

Speaker #1: The macro environment , particularly in the North and Northeast , continue to constrain discretionary spending . These are situational drivers for their short term or cyclical nature underpinning our confidence in the long term .

Speaker #1: Fundamentals of both the category and our portfolio. That said, let me share three potential trends and needs that can turn into structural drivers.

Speaker #1: Number one , the beer category in Brazil has evolved with value . It and we will were part of it . However , easy to drink beers are still the preferred choice of Brazilians .

Speaker #1: Number two , certain groups of consumers prefer sweeter beverages . And number three , more consumers are seeking a balanced lifestyle . As a consequence , and not by coincidence , we have been working to address these trends and needs .

Lisboa: Number one, the beer category in Brazil has evolved. We value it, we were part of it. However, easy-to-drink beers are still the preferred choice of Brazilians. Number two, certain groups of consumers prefer sweeter beverage. Number three, more consumers are seeking a balanced lifestyle. As a consequence and not by coincidence, we have been working to address these trends and needs. Our portfolio of brands spans a wide range of liquid profiles. Our easy-to-drink brands are relevant in all price segments, and the brands that are growing the most in our portfolio address such need. We already lead the ready-to-drink space with products such as Beats and Brutal Fruit, which cater directly to the sweet-seeking consumers. Additionally, we are launching Flying Fish, a successful international brand with the aim of developing the flavored beer segment in Brazil.

Carlos Lisboa: Number one, the beer category in Brazil has evolved. We value it, we were part of it. However, easy-to-drink beers are still the preferred choice of Brazilians. Number two, certain groups of consumers prefer sweeter beverage. Number three, more consumers are seeking a balanced lifestyle. As a consequence and not by coincidence, we have been working to address these trends and needs. Our portfolio of brands spans a wide range of liquid profiles. Our easy-to-drink brands are relevant in all price segments, and the brands that are growing the most in our portfolio address such need. We already lead the ready-to-drink space with products such as Beats and Brutal Fruit, which cater directly to the sweet-seeking consumers. Additionally, we are launching Flying Fish, a successful international brand with the aim of developing the flavored beer segment in Brazil.

Speaker #1: Our portfolio of .

Speaker #2: Brands and spend . With broad .

Speaker #1: Our easy-to-drink brands are relevant in all markets.

Speaker #2: Segments .

Speaker #1: Brands that are growing the most in our portfolio address such need . We are ready to lead the ready to drink space with products such as beats and brutal fruit , which cater directly to the sweet seeking consumers .

Speaker #1: Additionally , we are launching Flying Fish , a successful international brand with the aim of developing the flavor Beer segment in Brazil . This segment has been growing globally , reaching over 3% mix of the beer industry in several countries and for balance , lifestyle seekers .

Speaker #1: Our no alcohol portfolio , together with Stella Pure Gold and Michelob Ultra , has a strong appeal , offering moderation alternatives without giving up the great beer experience .

Lisboa: This segment has been growing globally, reaching over 3% mix of the beer industry in several countries. For balanced lifestyle seekers, our no-alcohol portfolio, together with Stella Artois Pure Gold and Michelob Ultra, has a strong appeal, offering moderation alternative without giving up the great beer experience. In summary, while we read the current industry headwinds as situational, our strong portfolio and innovation agenda ensure we remain well-positioned to capture future growth and keep shaping the beer category. Now, let's move to our performance in Brazil beer. Over 100% of the volume decline is explained by the industry performance. Our brands once again improving equity, gaining low single digits sellout market share according to Nielsen, while expanded net revenue per hectoliter. The market share gains came across all relevant segments. In the core segment, volume declined by low teens, reflecting the overall industry context.

Carlos Lisboa: This segment has been growing globally, reaching over 3% mix of the beer industry in several countries. For balanced lifestyle seekers, our no-alcohol portfolio, together with Stella Artois Pure Gold and Michelob Ultra, has a strong appeal, offering moderation alternative without giving up the great beer experience. In summary, while we read the current industry headwinds as situational, our strong portfolio and innovation agenda ensure we remain well-positioned to capture future growth and keep shaping the beer category. Now, let's move to our performance in Brazil beer. Over 100% of the volume decline is explained by the industry performance. Our brands once again improving equity, gaining low single digits sellout market share according to Nielsen, while expanded net revenue per hectoliter. The market share gains came across all relevant segments. In the core segment, volume declined by low teens, reflecting the overall industry context.

Speaker #1: In summary , while we read the current industry headwinds as situational , our strong portfolio and innovation agenda ensure we remain well positioned to capture future growth and keep shaping the beer category .

Speaker #1: Now let's move to our performance in Brazil . Beer . Over 100% of the volume decline is explained by the industry performance . Our brands owns again improving equity , gaining low single digit sell out market share .

Speaker #1: According to Nielsen, while expanded net revenue per hectoliter, the market share gains came across all relevant segments. In the core segment, volume declined by low teens, reflecting the overall industry context.

Speaker #1: However , the market share progressed versus last year as relative price improved through the quarter . Premium and super premium brands ounce again stood out , growing mid-teens and gaining sell out market share , reaching close to 50% after six years of consistent recovery .

Lisboa: However, the market share progressed versus last year as relative price improved through the quarter. Premium and super premium brands once again stood out, growing mid-teens and gaining sell out market share, reaching close to 50%. After 6 years of consistent recovery, we achieved the highest share level since 2015, according to our estimates. This performance was driven by Original, Stella family, and Corona. The latter two at the top end of the price index. Our Balanced Choice portfolio maintained strong momentum, growing mid-sixties. Stella Pure Gold more than doubled its volumes. Michelob Ultra grew over 80% and our no alcohol beer portfolio expanded by low twenties, further strengthening our leadership in the segment. Moving to Brazil NAB.

Carlos Lisboa: However, the market share progressed versus last year as relative price improved through the quarter. Premium and super premium brands once again stood out, growing mid-teens and gaining sell out market share, reaching close to 50%. After 6 years of consistent recovery, we achieved the highest share level since 2015, according to our estimates. This performance was driven by Original, Stella family, and Corona. The latter two at the top end of the price index. Our Balanced Choice portfolio maintained strong momentum, growing mid-sixties. Stella Pure Gold more than doubled its volumes. Michelob Ultra grew over 80% and our no alcohol beer portfolio expanded by low twenties, further strengthening our leadership in the segment. Moving to Brazil NAB.

Speaker #1: We achieved the highest share level since 2015 , according to our estimates . This performance was driven by original stellar family and Corona , the latter two at the top end of the price index and our balanced choice portfolio , maintaining strong momentum , growing mid 60s .

Speaker #1: Stellar pure gold more than doubled its volumes . Michelob ultra grew over 80% and our Non-alcohol beer portfolio expanded by low 20s . Further strengthening our leadership in the segment .

Speaker #1: Moving to Brazil, NAB throughout 2025, the CSD industry has experienced a deceleration from up low single digits in Q1 to down mid-single digits in Q3, according to Nielsen. This deceleration was driven by similar situational factors that impacted the beer industry. In addition, our revenue management decisions last quarter led to an inventory phasing into this quarter, impacting selling performance.

Lisboa: Throughout 2025, the CSD industry has experienced a deceleration from up low single-digit in Q1 to down mid-single-digit in Q3, according to Nielsen, driven by similar situational factors that impacted the beer industry. In addition, our revenue management decisions last quarter led to an inventory phasing into this quarter, impacting sell-in performance. In this context, our brands continued to strengthen and our market share grew year-to-date and was stable to low single-digit down in the quarter, according to our estimates, with a net revenue per hectoliter above inflation. Our non-sugar portfolio once again delivered double-digit growth and now accounts for more than 25% of total NAB volumes. In Argentina, the consumption environment remained challenging. Our beer volumes declined mid-single-digit, underperforming the industry, reflecting an unfavorable temporary price relativity dynamics. However, brand equity remains stable, supported by the strength of our mega-brands.

Carlos Lisboa: Throughout 2025, the CSD industry has experienced a deceleration from up low single-digit in Q1 to down mid-single-digit in Q3, according to Nielsen, driven by similar situational factors that impacted the beer industry. In addition, our revenue management decisions last quarter led to an inventory phasing into this quarter, impacting sell-in performance. In this context, our brands continued to strengthen and our market share grew year-to-date and was stable to low single-digit down in the quarter, according to our estimates, with a net revenue per hectoliter above inflation. Our non-sugar portfolio once again delivered double-digit growth and now accounts for more than 25% of total NAB volumes. In Argentina, the consumption environment remained challenging. Our beer volumes declined mid-single-digit, underperforming the industry, reflecting an unfavorable temporary price relativity dynamics. However, brand equity remains stable, supported by the strength of our mega-brands.

Speaker #1: In this context, our brands continue to strengthen, and our market share grew year to date. It was stable to low single digits down in the quarter, according to our estimates.

Speaker #1: With a net revenue per liter above inflation . Our Non-sugar portfolio once again delivered double digit growth . And now accounts for more than 25% of total NAB volumes in Argentina .

Speaker #1: The consumption environment remained challenging . Our beer volumes declined mid-single digit , underperforming the industry , reflecting an unfavorable temporary price . Relativity dynamics .

Speaker #1: However , brand equity remains stable , supported by the strength of our mega brands . Furthermore , we remain constructive on the long term prospects for both the country and the beer category in the Dominican Republic , the operating environment and beer share of throat continue to improve sequentially , supported by a healthier price .

Speaker #1: Relativity across categories president brand , the cornerstone of the category , strengthened its equity ounce again reinforcing its leadership and cultural connection with consumers in the country .

Lisboa: Furthermore, we remain constructed on the long-term prospects for both the country and the beer category. In the Dominican Republic, the operating environment and beer share of throat continued to improve sequentially, supported by a healthier price relativity across categories. Presidente brand, the cornerstone of the category, strengthened its equity once again, reinforcing its leadership and cultural connection with consumers in the country. Finally, in Canada, the beer industry declined by mid-single digit in the quarter. We estimate that we outperformed the industry in both beer and beyond beer. The Ontario market continued to progress, supported by the route to market expansion implemented last year. Our beer performance was led by Michelob Ultra, Busch, and Corona, which we estimate were among the top five volume share gainers in the industry. Now, let me hand over to Fleury, who will walk you through our financial performance in more detail.

Carlos Lisboa: Furthermore, we remain constructed on the long-term prospects for both the country and the beer category. In the Dominican Republic, the operating environment and beer share of throat continued to improve sequentially, supported by a healthier price relativity across categories. Presidente brand, the cornerstone of the category, strengthened its equity once again, reinforcing its leadership and cultural connection with consumers in the country. Finally, in Canada, the beer industry declined by mid-single digit in the quarter. We estimate that we outperformed the industry in both beer and beyond beer. The Ontario market continued to progress, supported by the route to market expansion implemented last year. Our beer performance was led by Michelob Ultra, Busch, and Corona, which we estimate were among the top five volume share gainers in the industry. Now, let me hand over to Fleury, who will walk you through our financial performance in more detail.

Speaker #1: Finally , in Canada , the beer industry declined by mid-single digit in the quarter . We estimate that we outperformed the industry in both beer and beyond beer .

Speaker #1: The Ontario market continued to progress , supported by the route to market expansion implemented last year . Our beer performance was led by Michelob Ultra , Busch and Corona , which we estimate were among the top five volume share gainers in the industry .

Speaker #1: Now , let me hand over to Florie , who will walk you through our financial performance in more detail . Thank you . And hello everyone .

Speaker #1: Today I would like to walk you through our financial performance highlights using our capital allocation framework , starting with our priority number one to invest in our business here .

Speaker #1: Our focus is to allocate capital efficiently and maximize return on investments. One way we do that is by driving efficiencies across our costs and expenses.

Guilherme Fleury: Thank you, Lisboa, and hello, everyone. Today, I would like to walk you through our financial performance highlights using our capital allocation framework. Starting with our priority number one, to invest in our business. Here, our focus is to allocate capital efficiently and maximize return on investments. One way we do that is by driving efficiencies across our costs and expenses baselines, freeing up resources to continue to invest behind our business and our brands, strengthening the connection with our consumers. Building on that, in Q3, our disciplined cost management allowed us to quickly adapt our brewing processes to a more challenging operating environment and deliver strong productivity with tighter process controls and lower conversion costs, mainly in our vertical operations. As a result, we expanded the EBITDA margin in most of our business units once again. Now, moving to net income.

Speaker #1: Baselines , freeing up resources to continue to invest behind our business and our brands , strengthening the connection with our consumers , building on that , in quarter three , our disciplined cost management allowed us to quickly adapt our brewing processes to a more challenging operating environment and deliver strong productivity with tighter process controls and lower conversion costs , mainly in our vertical operations .

Speaker #1: As a result , we expanded EBITDA margin in most of our business units once again , now moving to net income . Our normalized net income reached 3.8 billion reais , up 7% year over year , mainly driven by a lower effective tax rate , which more than offset higher financial expenses .

Speaker #1: Our stated net income reached 4.9 billion reais , up 36% versus last year , reflecting one off effects . How detail in a moment in this quarter , our net financial expenses closed at 1.1 billion reais , about 400 million higher than last year , mostly due to two factors .

Guilherme Fleury: Our normalized net income reached BRL 3.8 billion, up 7% year-over-year, mainly driven by a lower effective tax rate, which more than offset higher financial expenses. Our stated net income reached BRL 4.9 billion, up 36% versus last year, reflecting one-off effects I will detail in a moment. In Q3, our net financial expenses closed at BRL 1.1 billion, about BRL 400 million higher than last year, mostly due to two factors we already addressed in Q2. One, a higher effects hedging carry costs in Brazil due to interest rate gap between Brazil and the US. Two, the cost of sourcing US dollars in Bolivia. On income tax, our effective tax rate in Q3 was 6.7% compared with 23.6% a year ago.

Speaker #1: We already addressed in quarter two one , a higher FX hedging carry costs in Brazil due to interest rate gap between Brazil and the US , and two , the cost of sourcing US dollars in Bolivia on income tax .

Speaker #1: Our effective tax rate in quarter three was 6.7% , compared with 23.6% a year ago . The decline reflects mostly three one offs , which totaled 630 million reais and didn't have a relevant cash tax impact in the quarter .

Speaker #1: Excluding them . Our effective tax rate would have been around 20% , consistent with recent levels . Let me go over them . One .

Guilherme Fleury: The decline reflects mostly 3 one-offs, which total BRL 630 million and didn't have a relevant cash tax impact in the quarter. Excluding them, our effective tax rate would have been around 20%, consistent with recent levels. Let me go over them. One, following a change in legislation, we recognize a partial reversal of previously recorded tax liabilities associated with the 2017 amnesty program, as detailed in note 8.2 to our Q3 financial statements. Two, fiscal incentives recognition. Three, the Barbados divestment that generated a gain of BRL 884 million, where part of it was non-taxable in Dominican Republic. The sale of Barbados is a tangible example of our second capital allocation priority at work: evaluate inorganic opportunities.

Speaker #1: Following a change in legislation , we recognized a partial reversal of previously recorded tax liabilities associated with the 2017 amnesty program as detailed in note 8.2 to our Q3 financial statements .

Speaker #1: Number two , fiscal incentives , recognition and number three , the Barbados Divestment that generated a gain of 884 million , where part of it was non-taxable in Dominican Republic , the sale of Barbados is a tangible example of our second capital allocation priority at work .

Speaker #1: Evaluate inorganic opportunities. Here, we completed the first steps of the transaction, transferring control to Cost Cap, a long-term partner in the Caribbean.

Speaker #1: The transaction simplifies our structure and keeps our brands in the region. Further details are disclosed in Note One to our financial statements.

Speaker #1: Lastly , regarding our third priority return cash to shareholders over time , as we approach the end of the year , I remain confident on the consistent cash generation of our business .

Guilherme Fleury: Here we completed the first steps of the transaction, transferring control to Koscab, a long-term partner in the Caribbean. The transaction simplifies our structure and keeps our brands in the region. Further details are disclosed in note one to our financial statements. Regarding our third priority, return cash to shareholders over time. As we approach the end of the year, I remain confident on the consistent cash generation of our business. Cash flow from operating activities remains solid, totaling BRL 6.9 billion despite softer volumes and higher cash taxes this quarter. Versus 2024, our cash flow from operating activities is down BRL 1.2 billion, mainly due to a slower monetization pace of existing income tax credits in Brazil. These credits will continue to be used over time, aligned with our tax strategy, and are detailed in note seven to our Q3 financial statements.

Speaker #1: Cash flow from operating activities remained solid, totaling R$6.9 billion despite softer volumes and higher cash taxes this quarter versus 2020.

Speaker #1: For our cash flow from operating activities is down 1.2 billion reais , mainly due to a lower monetization pace of existing income tax credits in Brazil .

Speaker #1: These credits will continue to be used over time, aligned with our tax strategy and as detailed in Note Seven to our Q3 financial statements.

Speaker #1: Lastly , during the year , we already announced a total dividend of 6 billion . Also , as Lisboa mentioned , we are starting a new 2.5 billion buyback program after the completion of the previous one in June .

Speaker #1: Both the dividend distribution and the share buyback programme reinforce our confidence in our business and our commitment to returning cash to shareholders over time .

Guilherme Fleury: Lastly, during the year, we already announced a total dividend of BRL 6 billion. Also, as Lisboa mentioned, we are starting a new BRL 2.5 billion buyback program after the completion of the previous one in June. Both the dividend distribution and the share buyback program reinforce our confidence in our business and our commitment to returning cash to shareholders over time. With that, let me hand it back to you, Lisboa.

Speaker #1: With that , let me hand it back to you , Lisboa . Thank you . Florie . As we start the fourth quarter , I believe that we are well positioned to grow .

Speaker #2: Start strong . Great . And to . Especially in America . Beer and Lowe's . I want our team experience , especially .

Lisboa: Thank you, Flory. As we start the Q4, I believe that we are well our grit, and focus on what we can control are inspiring and give me even more confidence that we are becoming a better version of ourselves. Thank you for your attention. I will now hand it back to the operator for the Q&A.

Carlos Lisboa: Thank you, Flory. As we start the Q4, I believe that we are well our grit, and focus on what we can control are inspiring and give me even more confidence that we are becoming a better version of ourselves. Thank you for your attention. I will now hand it back to the operator for the Q&A.

Speaker #1: Our grit and focus on what we can control . Are inspiring . And give me even more confidence that we are becoming a better version of ourselves .

Speaker #1: Thank you for your attention, and I will now hand it back to the operator for the Q&A.

Speaker #3: We will now begin the Q&A session . To ask a question we kindly ask sell side analysts to click on Raise hand button at the bottom of the screen .

Speaker #3: To remove a question from the queue or after your question has already been addressed , please click lower hand button . We kindly reinforce our request that each participant asks only a single question .

Operator: We will now begin the Q&A session. To ask a question, we kindly ask sell-side analysts to click on raise hand button at the bottom of the screen. To remove a question from the queue or after your question has already been addressed, please click lower hand button. We kindly reinforce our request that each participant asks only a single question. Our first question comes from Lucas Ferreira with JP Morgan. You can open your microphone.

Speaker #3: Our first question comes from Lucas Ferreira with J.P. Morgan . You can open your microphone .

Speaker #4: Hi guys , I hope you hear me well , my question is on on the cogs line . I think there was one of the positive surprises we had with the results , especially in a quarter where production probably was softer .

Speaker #4: Right ? I was expecting some sort of effect of a lower fixed cost dilution , but it came better than expected . So if you guys can explore that in a bit more details , why why the costs were lower specifically , this quarter , does it have to do with the hedging strategies , some sort of a tenderization of that hedge effect or but also the initiatives for for reducing your cost base if you can get into this and then since you're reiterating the guidance , you know , what's what's the what would imply for the fourth quarter like sort of big acceleration of the cost per hectoliter if , if these acceleration is also has to do with , with sort of the hedging calendar or if there's anything else that we have to be aware of .

Lucas Ferreira: Hi, guys. I hope you hear me well. My question is on the COGS line. I think that was one of the positive surprises we had with the results, especially in a quarter where production probably was softer, right? I was expecting some sort of effect of a lower fixed cost dilution, but COGS came better than expected. If you guys can, you know, explore that in a bit more details, why the costs were lower specifically this quarter. Does it have to do with the hedging strategies, some sort of a calendarization of that hedge effect or also on the initiatives for reducing your cost base, if you can get into this.

Lucas Ferreira: Since you're reiterating the guidance, you know, what would imply for Q4, like, sort of big acceleration of the cost per hectoliter? If this acceleration is also has to do with the sort of the hedging calendarization or if there's anything else that we have to be aware of. Thank you very much.

Speaker #4: Thank you very much .

Speaker #1: Hi , Lucas , it's .

Speaker #4: Fleury here . Can you hear me ? Well , just checking the . Yes . Okay . No . Great . Thank you very much .

Speaker #4: Okay .

Speaker #1: So , Luca .

Speaker #4: Let me just start by saying that , as you probably remember , I think Ambev is being known for it . Very strict discipline and action driven organization .

Speaker #4: And I think that comes on over time. You know, working in emerging markets, we develop a capacity for navigating volatility while delivering results.

Lisboa: Hi, Lucas. It's Fleury here. Can you hear me well? Just checking the.

Carlos Lisboa: Hi, Lucas. It's Fleury here. Can you hear me well? Just checking the.

Lucas Ferreira: Yes.

Lisboa: Okay. No, great.

Carlos Lisboa: Okay. No, great.

Lucas Ferreira: Very well.

Lisboa: Thank you very much. Okay. Lucas, let me just start by saying that, as you probably remember, I think Ambev is being known for its very strict discipline and action-driven organization. I think that comes on over time, you know, working in emerging markets, we develop a capacity of navigating volatility while delivering results. Why I'm starting with that is because, if you go back 1 step in Q2, I mentioned to you guys that most of the benefit that we were having in our COGS was related to the SKU rationalization and what we control. On Q3, it's not different from that. It comes from a series of initiatives on what we can control that goes from production costs to breweries footprint and production, and also utilizing our vertical operations in which we normally have better costs.

Carlos Lisboa: Thank you very much. Okay. Lucas, let me just start by saying that, as you probably remember, I think Ambev is being known for its very strict discipline and action-driven organization. I think that comes on over time, you know, working in emerging markets, we develop a capacity of navigating volatility while delivering results. Why I'm starting with that is because, if you go back 1 step in Q2, I mentioned to you guys that most of the benefit that we were having in our COGS was related to the SKU rationalization and what we control. On Q3, it's not different from that. It comes from a series of initiatives on what we can control that goes from production costs to breweries footprint and production, and also utilizing our vertical operations in which we normally have better costs.

Speaker #4: What I'm starting with is that if you go back one step in Q2, I mentioned to you guys that most of the benefit we were having in our COGS was related to the SKU rationalization and what we control in Q3.

Speaker #4: It's not different from that. It comes from a series of initiatives on what we can control that goes from production costs to brewery footprint and production, and also utilizing our vertical operations in which we normally have better costs.

Speaker #4: So , in essence , I think this is what the company does well , it's really focused on what we control , a series of initiatives , and I might frustrate you .

Speaker #4: There's no one single one , but there's a collection of initiatives that has been working through the organization with PMOs , of course , with Lisboa and myself , with several areas .

Lisboa: In essence, I think this is what the company does well. It's very focused on what we control, a series of initiatives. I might frustrate you, there's no one single one, but there's a collection of initiatives that has been working through the organization with PMOs, of course, with Lisboa and myself, with several areas. That's how we were able to achieve, I would say, a positive cash COGS increase compared to what we have said before. Moving to guidance. I think Lisboa made it very clear on his initial speech, but I will reinforce. The guidance is the guidance. We are not changing our guidance for Brazil beer cash COGS per hectoliter excluding Marketplace.

Carlos Lisboa: In essence, I think this is what the company does well. It's very focused on what we control, a series of initiatives. I might frustrate you, there's no one single one, but there's a collection of initiatives that has been working through the organization with PMOs, of course, with Lisboa and myself, with several areas. That's how we were able to achieve, I would say, a positive cash COGS increase compared to what we have said before. Moving to guidance. I think Lisboa made it very clear on his initial speech, but I will reinforce. The guidance is the guidance. We are not changing our guidance for Brazil beer cash COGS per hectoliter excluding Marketplace.

Speaker #4: So that's how we were able to achieve , I would say , a positive cash Cogs increase compared to what we have said before .

Speaker #4: Now moving to guidance , I think Lisboa made it very clear on his initial speech , but I will reinforce the guidance . Is the guidance .

Speaker #4: We are not changing our guidance for Brazil beer , cash costs per hectoliter , excluding marketplace . What is important to highlight is now with what we know will continue to work very hard .

Speaker #4: To deliver the guidance within the first half of the range . If I may say , five and a half to seven , which is our ambition .

Speaker #4: And by doing that together with our continue disciplined revenue management , I believe we could potentially look into the expansion of margins over time .

Lisboa: What is important to highlight is now with what we know, we will continue to work very hard to deliver the guidance within the first half of the range, if I may say, 5.5 to 7, which is our ambition. By doing that, together with our continued disciplined revenue management, I believe we could potentially look into the expansion of margins over time.

Carlos Lisboa: What is important to highlight is now with what we know, we will continue to work very hard to deliver the guidance within the first half of the range, if I may say, 5.5 to 7, which is our ambition. By doing that, together with our continued disciplined revenue management, I believe we could potentially look into the expansion of margins over time.

Speaker #4: Thank you very much .

Speaker #3: Our next question comes from Nike with Bradesco. You can open your microphone.

Speaker #5: Hello, Lisboa. Thank you for taking my question. I wanted to explore a little bit more about the beer industry environment in Brazil.

Speaker #5: Very interesting . The comment you made Lisboa , in terms of the weather representing the 70% of the decline and the remainder , the weaker consumer .

Lucas Ferreira: Thank you very much.

Operator: Our next question comes from Henrique Brustolin with Bradesco. You can open your microphone.

Speaker #5: I would like to hear a little bit more , you know how you see this trend shaping up into Q4 , especially if you could comment on the on the consumer part of this equation and also , given that the the headwinds were apparently different , right ?

Henrique Brustolin: Hello, Lisboa, Fleury. Thanks for taking my question. I wanted to explore a little bit more the beer industry environment in Brazil. Very interesting the comments you made, Lisboa, in terms of the weather representing the 70% of the decline and the remainder the weaker consumer. I would like to hear a little bit more, you know, how you see this trend shaping up into Q4, especially if you could comment on the consumer part of this equation. Also, given that the headwinds were apparently different, right? In the north, northeast than to the south, southeast. If you also saw any big difference in terms of, you know, the volume performance across these two regions or even how the portfolio performed within the different categories. These would be my questions. Thank you.

Speaker #5: In the in the north northeast , then to the south southeast , if you also saw any big difference in terms of the volume performance across these two regions or even the how the portfolio performed within the different categories , this would be my questions .

Speaker #5: Thank you .

Speaker #4: Enrique .

Speaker #1: Nice to talk .

Speaker #4: To you . Thank you for the .

Speaker #1: Question . Let me highlight a few points .

Speaker #4: Here to .

Speaker #1: You know , to clarify some of your doubts . Right . First and foremost , everything that we see somehow is very aligned with .

Speaker #1: what we flagged in our second quarter result announcement . Right . So but having said that , during the , you know , the quarter , we saw , you know , the most important driver , situational driver , which was the weather gaining even more relevance , right ?

Lisboa: Henrique, nice to talk to you. Thank you for the question. Let me highlight a few points here to, you know, to clarify some of your doubts, right? First and foremost, everything that we see somehow is very aligned with what we flagged in our Q2 result announcement, right? Having said that, during the, you know, the quarter, we saw, you know, the most important driver, situational driver, which was the weather gaining even more relevance, right? Since the winter time pretty much took, you know, the entire quarter, right? Different from what happened in Q2, when mostly impacted June, right? I think the most important point to have in mind is the following: the underlying consumer engagement, which we measured based on participation and category equity, remains very solid, right?

Carlos Lisboa: Henrique, nice to talk to you. Thank you for the question. Let me highlight a few points here to, you know, to clarify some of your doubts, right? First and foremost, everything that we see somehow is very aligned with what we flagged in our Q2 result announcement, right? Having said that, during the, you know, the quarter, we saw, you know, the most important driver, situational driver, which was the weather gaining even more relevance, right? Since the winter time pretty much took, you know, the entire quarter, right? Different from what happened in Q2, when mostly impacted June, right? I think the most important point to have in mind is the following: the underlying consumer engagement, which we measured based on participation and category equity, remains very solid, right?

Speaker #1: Since the winter time , pretty much took , you know , the .

Speaker #4: Entire quarter . Right .

Speaker #1: Different from what happened in quarter two , when mostly impacted June . Right . So I think the most important point to have in mind .

Speaker #4: Is the .

Speaker #1: Following . The underlying consumer engagement , which we measured based on participation and category equity , remains very solid , right . And the decline was pretty much connected to a reduced in number of occasions .

Speaker #1: Right. And the reason why for that is exactly the situation factors that I flagged in the beginning of the conversation this morning in the session.

Speaker #1: Right south and southeast , pretty much , you know , the regions were we see , you know , accounted for majority of the volume in Brazil .

Lisboa: The decline was pretty much connected to a reduce in number of occasions, right. The reason why for that is exactly the two situational factors that I flagged in the beginning of the conversation in the session, right. South and Southeast, pretty much, you know, the reasons were we see, you know, accounting for majority of the volume in Brazil, pretty much 60%, impacted by, you know, colder and rainier conditions compared to a drier, right, and hottest conditions last year, right. North and Northeast, the other impact, right, which is connected to, right, disposable income constraints, which by the way, also impacted the first quarter. This was not necessarily, right, a surprise for us.

Carlos Lisboa: The decline was pretty much connected to a reduce in number of occasions, right. The reason why for that is exactly the two situational factors that I flagged in the beginning of the conversation in the session, right. South and Southeast, pretty much, you know, the reasons were we see, you know, accounting for majority of the volume in Brazil, pretty much 60%, impacted by, you know, colder and rainier conditions compared to a drier, right, and hottest conditions last year, right. North and Northeast, the other impact, right, which is connected to, right, disposable income constraints, which by the way, also impacted the first quarter. This was not necessarily, right, a surprise for us.

Speaker #1: Pretty much 60% impacted by , you know , colder and rainy conditions compared to a drier . Right . And hottest conditions last year .

Speaker #1: Right . And the north and northeast , they are impact right , which is connected to right disposable income constraints , which , by the way , also impacted the first quarter .

Speaker #1: This was not necessarily right.

Speaker #4: A surprise .

Speaker #1: For us . We have been measured that since the beginning of this year .

Speaker #4: Right .

Speaker #1: So it's interesting to see that, you know, especially.

Speaker #4: The the .

Speaker #1: The weather, but also, right, the disposable income constraint impacted mostly something that we also highlight during the second quarter announcement.

Speaker #1: The out of home occasion , which is very relevant for beer in Brazil . Right ? In other words , impacting particularly bars and restaurants .

Lisboa: We have been measuring that since the beginning of this year, right. It's interesting to see that, you know, especially the weather, but also, right, the disposable input constraint impacted mostly something that we also highlight during the Q2 announcement, the out-of-home occasion, which is very relevant for beer in Brazil, right. In other words, impacting particularly bars and restaurants, right. Now moving towards your question about what's coming, right, more. When we reflect about the situational end, right, which is weather and income, the weather remains, you know, in October, still a concern for us in HIWI, because we haven't seen any meaningful change. On the other hand, on the structural end, we also see a continuation of a good momentum our brands, right, presented in Q3, right.

Carlos Lisboa: We have been measuring that since the beginning of this year, right. It's interesting to see that, you know, especially the weather, but also, right, the disposable input constraint impacted mostly something that we also highlight during the Q2 announcement, the out-of-home occasion, which is very relevant for beer in Brazil, right. In other words, impacting particularly bars and restaurants, right. Now moving towards your question about what's coming, right, more. When we reflect about the situational end, right, which is weather and income, the weather remains, you know, in October, still a concern for us in HIWI, because we haven't seen any meaningful change. On the other hand, on the structural end, we also see a continuation of a good momentum our brands, right, presented in Q3, right.

Speaker #1: Right . So . Now moving towards your your question about what's coming , right . More so when we reflect about the situation and right , which is weather and income , the weather remains , you know , in October still .

Speaker #1: A concern for us in Hiki because we we haven't seen any meaningful change on the other hand , on the structural end , we also see a continuation of a good momentum .

Speaker #1: Our brands right presented in Q3 . Right . Which is what gives us confidence that we are well positioned right for the quarter to come .

Speaker #1: The last quarter to come this year , which will give us , you know , a pretty nice carryover into next year , which was the part of what we I'm sorry that we had a technical issue , but it was , you know , highlighting that we feel good and optimistic about the year to come because we're going to have the chance to jump into , you know , a year when we won't probably see that much of a hard copy impact coming from the from the weather , which was the most important , you know , the tractor , right situation , the tractor .

Lisboa: Which is what give us confidence that we are well-positioned, right, for the Q4 to come, the last Q4 to come this year, which will give us, you know, a pretty nice carryover into next year. Which was the part of what sorry that we had a technical issue, but I was, you know, highlighting that we feel good and optimistic about the year to come because we're gonna have the chance to jump into, you know, a year when we won't probably see that much of a hard comp impact coming from the, from the weather, which was the most important, you know, detractor, right, situational detractor for us this year, combined with the chance to put together, unite two amazing passions for, you know, Latin Americans, right, which are beer and soccer with the World Cup.

Carlos Lisboa: Which is what give us confidence that we are well-positioned, right, for the Q4 to come, the last Q4 to come this year, which will give us, you know, a pretty nice carryover into next year. Which was the part of what sorry that we had a technical issue, but I was, you know, highlighting that we feel good and optimistic about the year to come because we're gonna have the chance to jump into, you know, a year when we won't probably see that much of a hard comp impact coming from the, from the weather, which was the most important, you know, detractor, right, situational detractor for us this year, combined with the chance to put together, unite two amazing passions for, you know, Latin Americans, right, which are beer and soccer with the World Cup.

Speaker #4: For .

Speaker #1: Us this year , combined with the chance to put together unite two amazing . Passions for , you know , Latin Americans . Right .

Speaker #1: Which are beer and soccer with the World Cup and on top of that I as I mentioned before , this year when we reflect about participation and occasions , occasions right , we're more impacted by the two situational factors and next year we're going to have the chance .

Speaker #1: Right to explore more occasions since the World Cup time will match exactly with , you know , the the hardest period for us in the year .

Lisboa: On top of that, as I mentioned before, this year, when we reflect about participation in occasions, right, were more impacted by the two situational factors. Next year, we're gonna have the chance, right, to explore more occasions since the World Cup time will match exactly with, you know, the hardest period for us in the year. On top of that, especially in Brazil, we're gonna have a pretty interesting number of holidays that will help us create new consumption occasions for us.

Carlos Lisboa: On top of that, as I mentioned before, this year, when we reflect about participation in occasions, right, were more impacted by the two situational factors. Next year, we're gonna have the chance, right, to explore more occasions since the World Cup time will match exactly with, you know, the hardest period for us in the year. On top of that, especially in Brazil, we're gonna have a pretty interesting number of holidays that will help us create new consumption occasions for us.

Speaker #1: And on top of that , especially in Brazil , we're going to have a pretty interesting number of holidays that will help us create new consumption occasions for us .

Speaker #5: That's very clear . Lisboa . Thanks very much .

Speaker #1: Thank you .

Speaker #3: Our next question comes from Nadine Sarwat with Bernstein. You can open your microphone.

Speaker #6: I thank you for taking my question, guys. Great to see your commentary about Ambev reaching nearly 50% share of Brazil's premium and super premium beer for the first time in a decade, and I appreciate the comments that you made in your prepared remarks.

Henrique Brustolin: That's very clear, Lisboa. Thanks very much.

Lisboa: Thank you.

Carlos Lisboa: Thank you.

Operator: Our next question comes from Nadine Sarwat with Bernstein. You can open your microphone.

Speaker #6: With that benefit of hindsight , now , of the six years of seeing that improvement that you called out , can you comment on which initiatives you feel have been the most successful in getting you and your brand to this point in that segment ?

Nadine Sarwat: Hi. Thank you for taking my question, guys. Great to see your commentary about Ambev reaching nearly 50% share of Brazil premium and super premium beer for the first time in a decade. I appreciate the comments that you made in your prepared remarks. With that benefit of hindsight now of the 6 years of seeing that improvement that you called out, can you comment on which initiatives you feel have been the most successful in getting you and your brand to this point in that segment? What are your aspirations for your share of that segment over the coming quarters and years? Thank you.

Speaker #6: And what are your aspirations for your share of that segment over the coming quarters ? And years ? Thank you .

Speaker #4: Hi , Nadine , thank .

Speaker #1: You for your question . Very interesting . As you said , was a was a true V curve for us since 2015 . Until today .

Speaker #1: Right . And just to emphasize what you said , in last six years , we gained 14 points of . market share , consistent every single year .

Lisboa: Hi, Nadine. Thank you for your question. Very interesting. As you said, was a true V curve for us since 2015 until today, right? Just to emphasize what you said, the last 6 years, we gained 14 points of market share consistent every single year. That came mostly as a consequence of our ambition, Nadine, of being a true category captain, right? A captain that will bring to our consumers, not only Brazil, but across the board in all our markets. Since your question is about Brazil, especially in Brazil, right? More and more alternatives to enjoy beer in different occasions, by doing so, expanding our portfolio, we also have a chance to bring more consumers to our portfolio, right?

Carlos Lisboa: Hi, Nadine. Thank you for your question. Very interesting. As you said, was a true V curve for us since 2015 until today, right? Just to emphasize what you said, the last 6 years, we gained 14 points of market share consistent every single year. That came mostly as a consequence of our ambition, Nadine, of being a true category captain, right? A captain that will bring to our consumers, not only Brazil, but across the board in all our markets. Since your question is about Brazil, especially in Brazil, right? More and more alternatives to enjoy beer in different occasions, by doing so, expanding our portfolio, we also have a chance to bring more consumers to our portfolio, right?

Speaker #1: And that came mostly as a consequence of our ambition . Adding of being a true category captain . Right . A captain that will bring to our consumers not only Brazil but across the board in all our markets .

Speaker #1: But since your cash question is about Brazil , but especially in Brazil , right . More and more alternatives to enjoy beer in different occasions , and by doing so , expanding our portfolio , we also have a chance to bring more consumers to our portfolio .

Speaker #1: Right ? So if I have to ask , answer your question with just one point , that would be my answer , right ?

Speaker #1: Because we are here to build a portfolio strong enough to make our category even more appealing to our consumers. And, by the way, being in Brazil has one of the strongest equities across all markets globally.

Lisboa: If I have to answer your question with just one point, that would be my answer, right? Because we are here to build a portfolio strong enough to make our category even more appealing to our consumers. By the way, being Brazil has one of the strongest equities across all markets globally, okay? The point about the portfolio that I also like the most is the following: we know that as consumers graduate, and as we bring new consumers to the category, they want to have optionalities, right? They want to attend different needs in different occasions. That's exactly when the portfolio makes a difference, right? Today, we have a pretty interesting portfolio with complementary roles to play this mission, right? From Original to Spaten, right?

Carlos Lisboa: If I have to answer your question with just one point, that would be my answer, right? Because we are here to build a portfolio strong enough to make our category even more appealing to our consumers. By the way, being Brazil has one of the strongest equities across all markets globally, okay? The point about the portfolio that I also like the most is the following: we know that as consumers graduate, and as we bring new consumers to the category, they want to have optionalities, right? They want to attend different needs in different occasions. That's exactly when the portfolio makes a difference, right? Today, we have a pretty interesting portfolio with complementary roles to play this mission, right? From Original to Spaten, right?

Speaker #1: Okay. And the point about the portfolio that I also like the most.

Speaker #4: Is the .

Speaker #1: Following . We know that as consumers graduate and as we bring new consumers to the category , they want to have optionality , right ?

Speaker #1: They they want attend different needs in different occasions . And that's exactly when the portfolio makes a difference . Right . And today we have a pretty interesting portfolio with complementary roles to play this mission .

Speaker #1: Right from original to spot . Right in the first layer of the premium . And then to Corona and Stella family in the latter , right part of the pricing index , with different emotional and functional benefits .

Speaker #1: And the interesting piece of that is that since they are complementary, they are bringing incrementality for us instead of only cannibalization. Right?

Lisboa: In the first layer of the premium, and then to Corona and Stella family in the latter, right? Part of the pricing index with different emotional and functional benefits. The interesting piece of that is that since they are complementary, they are bringing incrementality for us instead of only cannibalization, right? This is, in my point of view, the magic around what we are doing here. It's very interesting because the same way we are building premium, now we are building a new growth engine that we call, right, balance. The balance piece is also gaining a lot of acceleration, right? On top of that, something that I'm not sure, you know, was that clear for you all, we are building a new growth engine beyond beer.

Carlos Lisboa: In the first layer of the premium, and then to Corona and Stella family in the latter, right? Part of the pricing index with different emotional and functional benefits. The interesting piece of that is that since they are complementary, they are bringing incrementality for us instead of only cannibalization, right? This is, in my point of view, the magic around what we are doing here. It's very interesting because the same way we are building premium, now we are building a new growth engine that we call, right, balance. The balance piece is also gaining a lot of acceleration, right? On top of that, something that I'm not sure, you know, was that clear for you all, we are building a new growth engine beyond beer.

Speaker #1: And this is the , in my point of view , the magic around what we are doing here . And it's very interesting because the same way we are building premium now , we are building a new growth engine that we call right balance and the balance piece is also gaining a lot of acceleration .

Speaker #1: Right ? And on top of that , something that I'm not sure you know , was that clear for you all we are building a new growth engine beyond beer and that , you know , beyond beer business .

Speaker #1: During the last three years have been growing double digits . And we have been growing ahead of industry . And today we are also the leaders , as we are the leaders in beyond as we are the leaders in premium .

Speaker #1: Right . So in essence , we are leading where growth is and where growth will be in the future .

Lisboa: That you know, beyond beer business, during the last three years have been growing double digits, and we have been growing ahead of the industry. Today, we are also the leaders, as we are the leaders in beyond, as we are the leaders in premium. Right? In essence, we are leading where growth is and where growth will be in the future.

Carlos Lisboa: That you know, beyond beer business, during the last three years have been growing double digits, and we have been growing ahead of the industry. Today, we are also the leaders, as we are the leaders in beyond, as we are the leaders in premium. Right? In essence, we are leading where growth is and where growth will be in the future.

Speaker #6: Very clear . Thank you .

Speaker #3: Our next question comes from Thiago with BTG . You can open your microphone .

Speaker #7: Hello . Good afternoon . It's everybody . My question is I'm trying to get a sense of the sustainability of the SG&A reduction that we saw .

Nadine Sarwat: Very clear. Thank you.

Speaker #7: Not only this quarter , but but I think throughout the year , although it might have been stronger this quarter and the release you mentioned the the variable compensation accrual changes , you also mentioned the phasing in marketing expenses in cash .

Operator: Our next question comes from Thiago Duarte with BTG. You can open your microphone.

Thiago Duarte: Hello, good afternoon. Lisboa, Fleury, everybody.

Lisboa: Hey, Thiago.

Carlos Lisboa: Hey, Thiago.

Nadine Sarwat: Hi, Thiago.

Speaker #7: So so my question is of the 0.4% consolidated organic reduction year over year in G&A in the quarter , how much would you say is related to this phasing of marketing ?

Thiago Duarte: My question is, I'm trying to get a sense of the sustainability of the SG&A reduction that we saw, not only this quarter, but I think throughout the year, although it might have been stronger this quarter. In the release, you mentioned the variable compensation accrual changes. You also mentioned the phasing marketing expenses in CAC. My question is, of the 0.4% consolidated organic reduction year-over-year in SG&A in the quarter, how much would you say is related to this phasing of marketing and bonus accruals? How much you believe it's more of a sustainable gain efficiency that you saw in expenses? If I may, a quick second question related to pricing in Brazil, Beer Brazil.

Speaker #7: And bonus accruals? How much do you believe it's more of a sustainable gain in efficiency that you saw in expenses? And if I may.

Speaker #7: A quick second , second question related to pricing in in Brazil , beer , Brazil . So I think that's more to you .

Speaker #7: Lisboa looking looking at the volume performance of the last two quarters , how surprised are you of the demand reaction to the price hike that you guys implemented ahead of the second quarter , and how that potentially affects the implementation of pricing that you normally do historically in Q4 of every year ?

Thiago Duarte: I think that's more to you, Lisboa. Looking at the volume performance of the last two quarters, how surprised are you of the demand reaction to the price hike that you guys implemented ahead of Q2? How that potentially affects the implementation of pricing that you normally do historically in Q4 of every year. Those would be my questions. Thank you.

Speaker #7: Those would be my questions. Thank you.

Speaker #4: Want me to start and thank you . So thank you very much for your question . Let me start more broadly . Then I'll go into the details .

Speaker #4: If you look into our consolidated income statement . But that applies to most of the markets in which you operate . What we've been doing is we continue despite the impact that we had in volume .

Speaker #4: We continue to invest in sales and marketing as a percentage of net revenue is slightly increased quarter over quarter . And that is the investment that we're very careful of maintaining .

Lisboa: Lisboa, do you want me to start?

Carlos Lisboa: Lisboa, do you want me to start?

Nadine Sarwat: Yeah.

Lisboa: Thank you. Thiago, thank you very much for your question. Let me start more broadly, then I'll go into the details. If you look into our consolidated income statement, but that applies to most of the markets in which you operate, what we've been doing is we continue, despite the impact that we had in volume, we continue to invest in sales and marketing as a percentage of net revenue, is likely increased quarter-over-quarter, and that is the investment that we're very careful of maintaining. Why talking about sustainability is that is the one that connect our brands with our consumers, and that's how we connect with our flywheel on value creation.

Carlos Lisboa: Thank you. Thiago, thank you very much for your question. Let me start more broadly, then I'll go into the details. If you look into our consolidated income statement, but that applies to most of the markets in which you operate, what we've been doing is we continue, despite the impact that we had in volume, we continue to invest in sales and marketing as a percentage of net revenue, is likely increased quarter-over-quarter, and that is the investment that we're very careful of maintaining. Why talking about sustainability is that is the one that connect our brands with our consumers, and that's how we connect with our flywheel on value creation.

Speaker #4: Why talking about sustainability is that is the one that connects our brands with our consumers , and that's how we connect with our flywheel on value creation .

Speaker #4: Specifically , what happened throughout the year is like we've been , I would say , managing well , distribution cost , even with lower volumes .

Speaker #4: So we were able to have a better absorption of fixed costs , even with declining volume . And on administrative expenses , I think here it connects a lot with the way we compensate our executives and our employees .

Lisboa: Specifically, what happened throughout the year, like, we've been, I would say, managing well distribution costs, even with lower volumes, so we were able to have a better absorption of fixed costs, even with declining volume. On administrative expenses, I think here it connects a lot with the way we compensate our executives and our employees. If you remember, Ambev is very well known for having a part of the compensation which is variable, which is important for us, and it's very connected with the performance of the year. If I were to summarize, there are three parts. One is base salary, the other one is the variable compensation, and we also have long-term incentive plans that are discretionary, and they distribute in order to make for the variance in value creation over time.

Carlos Lisboa: Specifically, what happened throughout the year, like, we've been, I would say, managing well distribution costs, even with lower volumes, so we were able to have a better absorption of fixed costs, even with declining volume. On administrative expenses, I think here it connects a lot with the way we compensate our executives and our employees. If you remember, Ambev is very well known for having a part of the compensation which is variable, which is important for us, and it's very connected with the performance of the year. If I were to summarize, there are three parts. One is base salary, the other one is the variable compensation, and we also have long-term incentive plans that are discretionary, and they distribute in order to make for the variance in value creation over time.

Speaker #4: If you remember , Ambev is very well known for having a part of the compensation , which is variable , which is important for us , and it's very connected with the performance of the year .

Speaker #4: If I were to summarize the three parts , one is the base salary , the other one is the variable compensation . And we also have long term incentive plans that are discretionary .

Speaker #4: And the distribute in order to make for the variance and value creation over time , this long term incentive is normally share related .

Speaker #4: So the employees and executives receive with a tenure of three years with that specifically this year , what I'm talking about variable compensation .

Speaker #4: This connects a lot with our company, which is in a difficult year, even though we've been working very hard on the levers that we can control.

Speaker #4: And we are delivering still a margin expansion and so on and so forth . It's also within , you know , going through a difficult time that is not in structure as as Boa said , is congenital .

Lisboa: This long-term incentive is normally share related. The employee, the executive receive with a tenure of 3 years with that. Specifically this year, when I'm talking about variable compensation, this connects a lot with our company, which is in a difficult year, even though we've been working very hard on the levers that we can control, and we are delivering still, like, margin expansion, so on and so forth. It's also we've been, you know, going through a difficult time that is not a structure, as Lisboa said, it's conjuncture that affects the volume. Therefore, the variable compensation of our teams were aligned with that, and with what we know today, what we have done was an adjustment on the accrual that we've been paying throughout the year. To summarize, we are continue to invest on what is very important, which is sales and marketing.

Carlos Lisboa: This long-term incentive is normally share related. The employee, the executive receive with a tenure of 3 years with that. Specifically this year, when I'm talking about variable compensation, this connects a lot with our company, which is in a difficult year, even though we've been working very hard on the levers that we can control, and we are delivering still, like, margin expansion, so on and so forth. It's also we've been, you know, going through a difficult time that is not a structure, as Lisboa said, it's conjuncture that affects the volume. Therefore, the variable compensation of our teams were aligned with that, and with what we know today, what we have done was an adjustment on the accrual that we've been paying throughout the year. To summarize, we are continue to invest on what is very important, which is sales and marketing.

Speaker #4: That affects the volume . Therefore , the variable compensation of our teams were aligned with that . And with what we know today , what we have done was an adjustment on the accrual that we made throughout the year .

Speaker #4: So to summarize , we are continue to invest on what is very important , which is sales and marketing . Our focus and discipline is also helping on the distribution and on the admin .

Speaker #4: That is very connected with how we see the performance of our company. With this adjustment on the variable compensation for the year.

Speaker #4: Now I'll turn to Lisboa .

Speaker #1: Thiago , let me touch on the second part . I think the most important message for you is the following . According to our modeling industry modeling , our price increase has no impact whatsoever on the industry performance this year due to the fact that prices for the industry for beer , they are still below inflation .

Lisboa: Our focus and discipline is also helping on the distribution and on the admin that is very connected with how we see the performance of our company with this adjustment on the variable compensation for the year.

Carlos Lisboa: Our focus and discipline is also helping on the distribution and on the admin that is very connected with how we see the performance of our company with this adjustment on the variable compensation for the year.

Thiago Duarte: Now I'll turn to Lisboa.

Lisboa: Hey, Thiago. Let me touch on the second part. I think the most important message for you is the following: according to our modeling, industry modeling, our price increase has no impact whatsoever on the industry performance this year due to the fact that prices for the industry, for beer, they are still below inflation. What brings somehow a small impact, very small compared to the situational factors that I flagged before, is the mixed piece, because continues to grow way ahead of volume average growth, right, with a higher price level. In the end, consumers always have a chance, right, to choose brands without such a higher price to consumer, right? That's the benefit of having, again, a strong portfolio of brands. That's exactly what we hold here in Brazil, right?

Carlos Lisboa: Hey, Thiago. Let me touch on the second part. I think the most important message for you is the following: according to our modeling, industry modeling, our price increase has no impact whatsoever on the industry performance this year due to the fact that prices for the industry, for beer, they are still below inflation. What brings somehow a small impact, very small compared to the situational factors that I flagged before, is the mixed piece, because continues to grow way ahead of volume average growth, right, with a higher price level. In the end, consumers always have a chance, right, to choose brands without such a higher price to consumer, right? That's the benefit of having, again, a strong portfolio of brands. That's exactly what we hold here in Brazil, right?

Speaker #1: What brings somehow a small impact ? Very small compared to the situation of factors that I flagged before . Is the mixed piece because because continues to grow way ahead of volume average growth , right ?

Speaker #1: With a higher price level . But in the end , consumers always have a chance , right , to choose brands without such a higher price to consumer .

Speaker #1: Right . And that's the benefit of having , again , a strong portfolio of brands . And that's exactly what we hold here in Brazil , right ?

Speaker #1: Not only strong core brands with different competitive situations by region , which differ a lot , by the way , in Brazil . Brazil is a continent , right ?

Speaker #1: And on top of that, we have the premium portfolio that also gives us write optionality to play around. And it's very, very interesting because we are gaining new capabilities with our digital ecosystem.

Lisboa: Not only strong core brands with different competitive situations by region, which differ a lot by the way in Brazil. Brazil is a continent, right? On top of that, we have the premium portfolio that also give us, right, optionality to play around. It's very, very interesting because we are gaining new capabilities with our digital ecosystem, right? In BEES, within BEES, we have AI power revenue management. In other words, we can personalize promotions, right, to boost sales, optimize discounts, and increase ROI simultaneously, right? In the end, just to finalize the point in somehow addressing the final piece of your question in terms of, you know, ambition. Our ambition is always to keep our prices in line with inflation, because we know the pricing component is a very important, right, accessibility for consumers in Brazil, right?

Carlos Lisboa: Not only strong core brands with different competitive situations by region, which differ a lot by the way in Brazil. Brazil is a continent, right? On top of that, we have the premium portfolio that also give us, right, optionality to play around. It's very, very interesting because we are gaining new capabilities with our digital ecosystem, right? In BEES, within BEES, we have AI power revenue management. In other words, we can personalize promotions, right, to boost sales, optimize discounts, and increase ROI simultaneously, right? In the end, just to finalize the point in somehow addressing the final piece of your question in terms of, you know, ambition. Our ambition is always to keep our prices in line with inflation, because we know the pricing component is a very important, right, accessibility for consumers in Brazil, right?

Speaker #1: Right . And these within bees , we have an AI powered revenue management . In other words , we can personalize promotions right , to boost sales , optimize , optimize discounts and increase ROI simultaneously .

Speaker #1: Right ? In the end , just to finalize the point and somehow addressing the final piece of your question in terms of , you know , ambition , our ambition is always to keep our prices in line with inflation because we know the pricing component is a very important right .

Speaker #1: Accessibility for consumers in Brazil , right ? And in good part of our , you know , consumers come from middle low pyramid , right , of the population .

Speaker #1: So it's important for us to always keep control in order to allow them to stay connected to the category .

Speaker #7: Very helpful . Thank you .

Speaker #1: Thank you .

Lisboa: A good part of our, you know, consumers come from middle, low pyramid, right, of the population. It's important for us to always keep control in order to allow them to stay connected to the category.

Carlos Lisboa: A good part of our, you know, consumers come from middle, low pyramid, right, of the population. It's important for us to always keep control in order to allow them to stay connected to the category.

Speaker #3: Next question from Isabela Simonato with Bank of America . You can open your microphone .

Speaker #8: Thank you . Hi , hi . Thank you for the call . I would like to to follow up on your last answer .

Speaker #8: Write about price and volume correlation . I mean , I understand that beer inflation is pretty much in line with general inflation in Brazil .

Thiago Duarte: Very helpful. Thank you.

Lisboa: Thank you.

Carlos Lisboa: Thank you.

Operator: Next question from Isabella Simonato with Bank of America. You can open your microphone.

Speaker #8: But I my guess is that the timing of the price increase , right , that you guys did in June , and that was followed by the competition in the middle of a bad weather season .

Isabella Simonato: Thank you. Hi, Lisboa. Hi, Fleury. Thank you for the call. I would like to follow up on your last answer, right, about price and volume correlation. I mean, I understand that beer inflation is pretty much in line with general inflation in Brazil. My guess is that the timing of the price increase, right, that you guys did in June, and that was followed by the competition in the middle of a bad weather season, right? I mean, how much could that have exacerbated or created a different elasticity, right, that price increase in the moment that it was done? I think, that's my question. A little bit similar to what we saw on NAB, right?

Speaker #8: Right ? I mean , how much could that have exacerbated or created a different elasticity ? Right . That price increase in the moment that it was done , I think that's my question .

Speaker #8: And a little bit similar to what we saw on NAB . Right . Because I think it was a really it was really surprising to see volumes coming down by that much , especially when when we look at the competition , right , volumes move up in the quarter .

Speaker #8: So I believe . You , you , you lost share . But more to understand the pricing strategy for this quarter , which unlike beer is well above inflation .

Isabella Simonato: I think, it was really surprising to see volumes coming down by that much, especially when we look at the competition, right, volumes move up in the quarter. I believe you lost share. More to understand the pricing strategy for this quarter, which unlike beer, is well above inflation, right? To understand how you guys seeing the volume reaction on that segment as well. If I may, a second question on LAS. I think we saw a big, pretty important pickup on margins. Just if you could elaborate a little bit on the drivers of that, even though volumes in Argentina were not that strong, I think would be clarifying. Thank you.

Speaker #8: Right . And to to to understand how your guys seeing the volume reaction on that segment as well . And if I may , a second question on on last , I think we we saw a big pretty important pickup on margins .

Speaker #8: Just if you could elaborate a little bit on on the drivers of that , even though volumes in Argentina were not that strong , I think we'd be clarifying .

Speaker #8: Thank you .

Speaker #1: Thank you Izabella , look , as you said , beer , CPI in line with overall CPI . No change there . Right ?

Speaker #1: According to our models , no different elasticity . Right ? Despite or you know , caused by the unfavorable weather . Right . So in our point of view , the timing of our price increase was very interesting .

Lisboa: Thank you, Isabella. Look, as you said, beer CPI in line with overall CPI, no change there, right? According to our models, no different elasticity, right? Despite or, you know, caused by the unfavorable weather, right? In our point of view, the timing of our price increase was very interesting, you know, came at the right moment for us to avoid any kind of distraction vis-a-vis what we flagged for you all, right, in the beginning of this year in terms of ambition for us, right? We said we want to protect and evolve with the profitability of the industry. We want to keep a very tight control and discipline cost expenses, because in the end, we want to bring growth with profitability. That's what we said, and we continue very focused behind that.

Carlos Lisboa: Thank you, Isabella. Look, as you said, beer CPI in line with overall CPI, no change there, right? According to our models, no different elasticity, right? Despite or, you know, caused by the unfavorable weather, right? In our point of view, the timing of our price increase was very interesting, you know, came at the right moment for us to avoid any kind of distraction vis-a-vis what we flagged for you all, right, in the beginning of this year in terms of ambition for us, right? We said we want to protect and evolve with the profitability of the industry. We want to keep a very tight control and discipline cost expenses, because in the end, we want to bring growth with profitability. That's what we said, and we continue very focused behind that.

Speaker #1: Was , you know , came at the right moment for us to avoid any kind of distraction vis a vis what we flagged for you .

Speaker #1: All right . In the beginning of this year , in terms of ambition for us , right . We said we want to protect and evolve with the profitability of the industry .

Speaker #1: We want to keep a very tight control in discipline , costs , expenses , because in the end , we want to bring growth with profitability .

Speaker #1: That's what we said . And we continue very focused behind that . On the situation side . Right . Meaning weather and disposable income , both categories , both industries , right .

Speaker #1: Beer and soft drinks were somehow impacted, right? But always keep in mind that for beer, the impact is harder because it impacts mostly, right?

Speaker #1: The most important occasion for the category , which is out of home . Right . And you all know what I'm saying here , right .

Lisboa: On the situational side, right, meaning weather and disposable income, both categories, both industries, right, beer and soft drinks, were somehow impacted, right. Always keep in mind that for beer, the impact is harder because it's impacting mostly, right, the most important occasion for the category, which is out of home, right. You all know what I'm saying here, right. Pay attention to the following. The point about, I think it's a little bit tricky to compare the both business, right. We took the price increase for beer in Q2 of this year. During Q3, we saw the relativity, right, change, right, gap shortening, that gave us the chance to put our share back on track.

Carlos Lisboa: On the situational side, right, meaning weather and disposable income, both categories, both industries, right, beer and soft drinks, were somehow impacted, right. Always keep in mind that for beer, the impact is harder because it's impacting mostly, right, the most important occasion for the category, which is out of home, right. You all know what I'm saying here, right. Pay attention to the following. The point about, I think it's a little bit tricky to compare the both business, right. We took the price increase for beer in Q2 of this year. During Q3, we saw the relativity, right, change, right, gap shortening, that gave us the chance to put our share back on track.

Speaker #1: But pay attention to the following . The point about I think is a little bit tricky to compare that both both business . Right .

Speaker #1: We took the price increase for beer in the second quarter of this year . During the third quarter , we saw the relativity right change right gap shortening .

Speaker #1: And that gave us the chance to put our share back on track. In fact, we see a balance between share and that position today than before.

Speaker #1: Right . Which is very interesting for us . Right . On the contrary , actually , what happened with soft drink ? We increased , you know , we had our revenue management agenda impacting mostly the end of the quarter too .

Lisboa: In fact, we see the balance between share and relative price even in a better position today than before than last year, right? Which is very interesting for us, right? On the contrary, actually, what happened with soft drinks, you know, we had our revenue management agenda impacting mostly the end of Q2, right? That brought an impact and a difference between selling and sell out. According to Nielsen, right, the industry, the CSD industry declined by mid-single digits, which was pretty much in line with our sellout. Okay? The difference comes exactly from the inventory, and that is the consequence of our revenue management decisions in the end of Q2. Now moving to Isabella, to your question about LAS.

Carlos Lisboa: In fact, we see the balance between share and relative price even in a better position today than before than last year, right? Which is very interesting for us, right? On the contrary, actually, what happened with soft drinks, you know, we had our revenue management agenda impacting mostly the end of Q2, right? That brought an impact and a difference between selling and sell out. According to Nielsen, right, the industry, the CSD industry declined by mid-single digits, which was pretty much in line with our sellout. Okay? The difference comes exactly from the inventory, and that is the consequence of our revenue management decisions in the end of Q2. Now moving to Isabella, to your question about LAS.

Speaker #1: Right ? And that brought an impact and a difference between selling and sell out . According to news . Right . The industry , the CSD industry declined by mid-single digits , which was pretty much in line with our sell out .

Speaker #1: Okay , the difference comes exactly from the inventory . And that is the consequence of our revenue management decisions . In the end of quarter two .

Speaker #4: Now , moving to Isabella , to your question about loss , I think when we look at last , their story , you need to understand of two different markets that consolidates into that .

Speaker #4: One is Bolivia and one is Argentina . Let me start with Bolivia . Bolivia continued to be a market that we are delivering strong results throughout the PNL , which is more than offsetting the impact that we had in Argentina , which in the quarter , if I may say , the demand was still recovering , but not there yet .

Lisboa: I think when we look at LAS, their story, you need to understand of two different markets that consolidates into that. One is Bolivia and one is Argentina. Let me start with Bolivia. Bolivia continued to be a market that we are delivering strong results throughout the P&L, which is more than offsetting the impact that we had in Argentina, which in the quarter, if I may say, the demand was still recovering but not there yet. There were impacts on inventory level, and also, we couldn't fully implement our revenue management in Argentina in the quarter given the economic situation there. It's a story of two markets. One is Argentina, that is tougher, and the other one is Bolivia. Overall, it's very important to highlight that we remain very confident about the two markets, and specifically in Argentina, which is being a more difficult environment.

Carlos Lisboa: I think when we look at LAS, their story, you need to understand of two different markets that consolidates into that. One is Bolivia and one is Argentina. Let me start with Bolivia. Bolivia continued to be a market that we are delivering strong results throughout the P&L, which is more than offsetting the impact that we had in Argentina, which in the quarter, if I may say, the demand was still recovering but not there yet. There were impacts on inventory level, and also, we couldn't fully implement our revenue management in Argentina in the quarter given the economic situation there. It's a story of two markets. One is Argentina, that is tougher, and the other one is Bolivia. Overall, it's very important to highlight that we remain very confident about the two markets, and specifically in Argentina, which is being a more difficult environment.

Speaker #4: There were impacts on inventory levels, and we couldn't fully implement our revenue management in Argentina in the quarter, given the economic situation there.

Speaker #4: So it's a story of two markets . One is Argentina . That is tougher and the other one is Bolivia . Overall , it's very important to highlight that we remain very confident about the two markets and specifically in Argentina , which is being a more difficult environment .

Speaker #4: Just to remember, we have operated there since 2000, and we believe that we have the best portfolio of brands that connect with the people.

Speaker #4: The right initiatives there on revenue management and cost to make it continue to be an important engine for our company . Going forward .

Lisboa: Just to remember that we operating there since 2000, we believe that we have the best portfolio of brands that connect with the people, the right initiatives there on revenue management and cost to make it continue to be an important engine for our company going forward.

Carlos Lisboa: Just to remember that we operating there since 2000, we believe that we have the best portfolio of brands that connect with the people, the right initiatives there on revenue management and cost to make it continue to be an important engine for our company going forward.

Speaker #3: Thank you . This concludes the Q&A session , and I would now like to pass the word back to Ambev . S team for closing remarks .

Speaker #1: Thank you for joining our call today. I would like to leave you with a final message. We are becoming a true ambidextrous company, making progress in all three pillars of our strategy.

Speaker #1: Resulting growth with profitability year to date , our top line grew 4% , while EBITDA was up 8% and EPs grew 7% . We are taking market intelligence to new levels , better understanding our consumers , their trends and translating them into actionable insights .

Operator: Thank you. This concludes the Q&A session, and I would now like to pass the word back to Ambev's team for closing remarks.

Lisboa: Thank you for joining our call today. I would like to leave you with a final message. We are becoming a true ambidextrous company, making progress in all three pillars of our strategy, resulting in growth with profitability. Year to date, our top line grew 4%, while EBITDA was up 8% and EPS grew 7%. We are taking market intelligence to new levels, better understanding our consumers, their trends, and translating them into actionable insights, making an already loved category even stronger. All in all, we are leading where growth is, especially in our main market, Brazil. Thank you and see you soon.

Operator: Thank you for joining our call today. I would like to leave you with a final message. We are becoming a true ambidextrous company, making progress in all three pillars of our strategy, resulting in growth with profitability. Year to date, our top line grew 4%, while EBITDA was up 8% and EPS grew 7%. We are taking market intelligence to new levels, better understanding our consumers, their trends, and translating them into actionable insights, making an already loved category even stronger. All in all, we are leading where growth is, especially in our main market, Brazil. Thank you and see you soon.

Speaker #1: Making an already loved category even stronger . All in all , we are leading where growth is , especially in our main market .

Speaker #1: Brazil. Thank you and see you soon.

Operator: Thank you. This concludes today's presentation. You may disconnect and have a nice day.

Q3 2025 Ambev SA Earnings Call

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