Chorus Q3 FY25 slides reveal accelerated fibre growth and 72% uptake milestone

Introduction & Market Context

Chorus Ltd (NZX:CNU) released its Q3 FY25 connections update on April 14, 2025, highlighting accelerated growth in fibre connections as New Zealand continues its transition away from legacy copper infrastructure. The telecommunications infrastructure company reported that fibre connections increased by 9,000 during the quarter to reach 1,107,000, showing stronger momentum compared to the 6,000 connections added in Q2 FY25.

New Zealand now ranks 19th globally for fibre uptake, positioning just behind Sweden and Japan, as the country continues its digital infrastructure transformation. This ongoing shift comes as the Commerce Commission has issued a draft recommendation that regulation of copper voice and broadband services is no longer needed to promote competition, with a final report due to the government by the end of 2025.

Quarterly Performance Highlights

Chorus reported that its fibre footprint now covers 1,525,000 addresses (excluding Local Fibre Company areas), with 5,000 additional addresses passed during Q3. The company’s overall fibre uptake grew by 0.3 percentage points to reach 72% of passed addresses, compared to a 0.1 percentage point increase in the previous quarter.

Total (EPA:TTEF) fixed line connections declined by 7,000 to 1,214,000, showing a slower rate of decline compared to the previous quarter’s 10,000 connection reduction. This reflects the ongoing transition from copper to fibre services, with copper broadband connections declining by 10,000 and copper voice connections falling by 5,000.

As shown in the following detailed breakdown of connections by technology type, the shift from copper to fibre continues at a steady pace:

Fibre Expansion and Uptake Details

Chorus completed 13,000 fibre installations during Q3, slightly down from 14,000 in the previous quarter. The company noted that it has 235,000 inactive fibre sockets, representing potential for future connections. The fibre expansion program continues to extend to smaller communities, with approximately 900 existing homes connected in the latest quarter.

The following chart illustrates the steady growth in fibre connections relative to addresses passed, with uptake increasing from 71.6% to 72.2% during the quarter:

Fibre uptake varies by geographic region, with Auckland and Dunedin both reaching 76.4% uptake, while Wellington trails at 70.8%. Notably, Dunedin showed the strongest quarterly growth at 1.6 percentage points, which the company attributed to student seasonality. Auckland’s uptake remained flat as address growth continued to outpace connection growth.

Speed Tier Distribution and Customer Preferences

Chorus reported continued growth in its entry-level Home Fibre Starter (50Mbps) plan, which added 9,000 connections to reach 77,000 total. The majority of this growth (66%) came from new fibre connections or customers switching from other networks, while 25% migrated from higher-speed plans, and 9% from legacy 50Mbps plans.

At the premium end of the market, residential connections of 1Gbps or higher grew by 2,000 and now comprise 25% of all residential plans. Business customers showed strong adoption of higher speeds, with 500Mbps+ connections growing by 6,000, driven by simplification of business plans.

The following charts detail the distribution of speed tiers across residential and business customers:

Copper Decline and Regulatory Updates

Copper connections continued their rapid decline, falling by 16,000 in Q3 to a total of just 107,000 remaining lines. This represents a 39% annual reduction in copper infrastructure. In Chorus fibre zones, only 19,000 copper lines remain in service, with the final approximately 4,000 lines scheduled to receive withdrawal notices this month.

The company reported that its broadband retention rate remains steady at 80% as customers transition from copper to fibre services. Chorus has now closed 1,771 copper broadband cabinets, up from 1,561 in the previous quarter.

The following chart illustrates the dramatic decline in copper lines across different zones:

In non-fibre zones, just 75,000 copper lines remain, representing a 24% reduction over the past year. Chorus is continuing its targeted fibre rollout to approximately 10,000 additional premises, with 2,500 now ready for service and 700 already connected.

Data Usage Patterns and Network Performance

Despite the ongoing shift to higher-speed connections, average monthly data usage on fibre remained stable at 642GB in March, compared to 644GB in December. The proportion of "terabyte users" (those consuming more than 1,000GB per month) was approximately 17% in March, slightly down from 17.5% in December.

Chorus reported a new peak traffic record of 5.4 Terabits per second in February, driven by a Fortnite game update. This demonstrates how specific digital events can create significant spikes in network utilization.

Forward-Looking Statements

Chorus continues to focus on completing its fibre rollout while managing the orderly sunset of its copper network. The company’s ~10,000 premises fibre expansion program is progressing, with 4,500 expressions of interest received from potential customers.

With copper deregulation on the horizon and fibre uptake continuing to grow, Chorus appears well-positioned to complete its transition to a predominantly fibre-based infrastructure provider. The stable data usage patterns suggest that current network capacity is sufficient for near-term demands, even as more customers migrate to higher-speed plans.

Full presentation:

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