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An announcement from Telus ( (TSE:T) ) is now available.
TELUS reported unaudited financial and operational results for the second quarter ended June 30, 2026, highlighting mixed performance across segments and a significant non-cash impairment. The company recorded a net loss of $1.8 billion driven by a $2.1 billion intangible asset and goodwill impairment related to its TELUS Digital unit, while consolidated service revenue dipped 1 per cent to $4.4 billion and adjusted EBITDA declined 2 per cent to $1.8 billion.
Operationally, TELUS added 17,000 mobile phone and 20,000 internet subscribers, plus 187,000 connected devices, supporting a 1 per cent year-over-year rise in mobile network revenue to $1.7 billion despite slightly higher churn and modest ARPU pressure. Cash provided by operating activities increased 15 per cent to $1.3 billion and free cash flow rose 2 per cent to $545 million, aided by lower taxes and lease payments, even as higher interest costs and lower adjusted EBITDA weighed on results.
In response to a shifting macro environment, TELUS announced three near-term strategic priorities: strengthening its financial foundation, sharpening operational discipline and reinvesting in its core businesses, and deploying resources toward profitable, sustainable growth. These priorities include a cost transformation program to embrace technology, eliminate redundancy and focus on customer service excellence, with greater emphasis on wireless, TELUS PureFibre and digital and AI infrastructure that underpin Canada’s economic and technological resilience.
The Board reset the quarterly dividend to $0.1875 per share, an annualized $0.75, representing a 55 per cent reduction from the prior level, effective with the October 1, 2026 payment to shareholders of record on September 10, 2026. TELUS also lowered its free cash flow dividend payout target to 45–60 per cent of trailing 12-month free cash flow and will remove the dividend reinvestment plan discount as of October 1, 2026, moves expected to generate about $2.7 billion in cumulative cash savings through 2028 for debt reduction.
The company ended the quarter with net debt to adjusted EBITDA of 3.5 times and is now targeting leverage of approximately 3.0 times or lower by year-end 2028, a timeline supported by the dividend reset, disciplined capital expenditures, organic free cash flow growth and proceeds from ongoing asset monetization initiatives. TELUS also updated its 2026 outlook, guiding for flat to negative 2 per cent consolidated service revenue growth, a 2 to 4 per cent decline in adjusted EBITDA and full-year free cash flow of about $1.8 billion, signalling a period of balance-sheet-focused recalibration before expected longer-term growth.
Management framed these actions as establishing the financial conditions for durable, compounding free cash flow and long-term shareholder value, while a more detailed capital returns framework and strategic update is slated to accompany third-quarter 2026 results in November. For stakeholders, the dividend cut and DRIP change mark a notable shift in capital-return policy toward deleveraging and funding investments in core networks and AI infrastructure, with potential implications for income-focused investors and the company’s competitive positioning in Canadian telecom and digital services.
The most recent analyst rating on (TSE:T) stock is a Hold
with a C$16.50 price target.
To see the full list of analyst forecasts on Telus stock,
see the TSE:T Stock Forecast page.
Spark’s Take on T Stock
According to Spark, TipRanks’ AI Analyst, T is a Neutral.
The score is driven primarily by fair-but-constrained fundamentals: stable operating cash generation and resilient operating margins are offset by elevated and rising leverage plus a notable TTM revenue decline. Technicals are broadly neutral with longer-term trend still weak. Valuation is supported by a very high dividend yield, but an elevated P/E tempers the benefit.
To see Spark’s full report on T stock,
click here.
More about Telus
TELUS Corporation is a Canadian telecommunications and technology company providing wireless, internet and fibre connectivity through its TELUS PureFibre network, alongside growing digital, health and AI-enabled services. The company focuses on premium mobile customers and infrastructure that supports Canada’s technological independence and economic growth, while managing capital intensity as major network builds near completion.
TELUS operates extensive wireless and broadband networks across Canada and is expanding sovereign AI data centres and digital infrastructure to reinforce its competitive position. With about 100,000 employees, it targets profitable, sustainable growth by concentrating investment where returns exceed its cost of capital and by leveraging its strong brand, customer loyalty and health-tech capabilities.
TELUS serves both consumer and business markets with mobile network services, internet and connected devices, as well as TELUS Health offerings that contribute to diversified service revenue. As its fibre build winds down, the firm is repositioning its capital allocation framework to strengthen its balance sheet, reduce leverage and support long-term shareholder value creation.
The company’s strategy now emphasizes balance sheet flexibility, lower capital intensity and disciplined operational efficiency, including a cost transformation program. This shift is designed to support compounding free cash flow and maintain TELUS’ role as a key player in Canada’s digital and communications infrastructure landscape.
Average Trading Volume: 8,003,170
Technical Sentiment Signal: Strong Sell
Current Market Cap: C$24.63B
Learn more about T stock on TipRanks’ Stock Analysis page.