Telus Corp ((TSE:T)) has held its Q3 earnings call. Read on for the main highlights of the call.
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TELUS Corp’s recent earnings call painted a picture of robust growth tempered by a few challenges. The company showcased strong customer growth and expansion in health services, alongside promising AI revenue prospects. However, there were noted challenges in mobile network revenue and TELUS Digital profitability.
Strong Customer Growth
TELUS achieved an impressive milestone with 288,000 total mobile and fixed customer additions, marking a 5% growth in customer connections compared to the previous year. This achievement underscores TELUS’ ability to attract and retain customers in a competitive market.
TELUS Health Expansion
The company’s health segment reported a substantial revenue growth of 18% and an adjusted EBITDA growth of 24%. This expansion has extended TELUS Health’s reach to over 160 million lives worldwide, highlighting its significant impact in the healthcare sector.
AI Revenue Growth Prospects
TELUS is making significant strides in AI, with its AI-enabling capabilities generating $800 million in revenue in 2025. The company expects this to increase to $2 billion by 2028, representing an annualized growth rate of over 30%, driven by its innovative AI initiatives.
Dividend Increase
Reflecting its commitment to delivering sustainable shareholder returns, TELUS announced a 4% increase in its quarterly dividend to $0.4184. This move is a testament to the company’s confidence in its financial health and future prospects.
Mobile Network Revenue Decline
Despite the positive growth in other areas, TELUS faced a slight decline in mobile network revenue by 0.6%, with ARPU continuing to decline by 2.8% in the quarter. This presents a challenge that the company will need to address moving forward.
Challenges in TELUS Digital Profitability
TELUS Digital is experiencing ongoing pressures on profitability, with an adjusted EBITDA margin at 11.1% for the third quarter. This indicates a need for strategic adjustments to improve profitability in this segment.
Forward-Looking Guidance
During the earnings call, TELUS provided forward-looking guidance, emphasizing its strategic initiatives and financial targets. The company aims to maintain its industry-leading postpaid mobile phone churn rate and achieve significant growth in its AI capabilities. TELUS also anticipates generating substantial cash synergies from the acquisition of TELUS Digital by 2026.
In summary, TELUS Corp’s earnings call highlighted a blend of strong growth and challenges. The company is making significant strides in customer growth, health services, and AI capabilities, while also facing hurdles in mobile network revenue and digital profitability. The overall sentiment remains positive, with TELUS committed to delivering sustainable shareholder returns and achieving its strategic goals.