Earnings call transcript: Rogers Q3 2025 earnings reveal steady growth

Rogers Communications Inc. reported its third-quarter 2025 earnings, showcasing a 4% increase in consolidated service revenue to 4.7 billion dollars. Despite a slight decrease in adjusted EBITDA, the company continues to innovate with new product launches and maintains strong market positions in both wireless and cable segments. The stock, currently trading at $38.51 with a market capitalization of $20.74 billion, has shown strong momentum with a 52% gain over the past six months. According to InvestingPro analysis, Rogers appears slightly overvalued at current levels, though it maintains a GOOD financial health score.

Key Takeaways

• Consolidated service revenue rose by 4% year-over-year.
• Adjusted EBITDA declined slightly by 1% year-over-year.
• Media revenue surged by 26%, reaching 753 million dollars.
• Wireless service revenue remained flat, while cable service revenue grew by 1%.
• The company launched a satellite-to-mobile service in beta and introduced Wi-Fi 7.

Company Performance

Rogers Communications demonstrated resilience in Q3 2025, with a 4% increase in consolidated service revenue compared to the same period last year. The company’s media segment was a standout performer, with revenue jumping 26%. Although adjusted EBITDA saw a slight decline of 1%, Rogers maintained its industry-leading margins in wireless and cable, highlighting its competitive strength in these segments.

Financial Highlights

• Revenue: 4.7 billion dollars, up 4% year-over-year
• Adjusted EBITDA: 2.5 billion dollars, down 1% year-over-year
• Media revenue: 753 million dollars, up 26% year-over-year
• Free cash flow: 829 million dollars, down 9% year-over-year
• Capital expenditures: 964 million dollars, flat year-over-year

Outlook & Guidance

Rogers anticipates positive growth in wireless service revenue and projects media revenue to reach 4 billion dollars in 2025. The company expects to reduce its capital expenditures to 3.7 billion dollars for the year, down from an earlier estimate of 3.8 billion dollars. Additionally, Rogers plans to acquire the remaining 25% stake in MLSE in 2026, further strengthening its sports and media assets valued at over 15 billion dollars. With a strong gross profit margin of 46.6% and analyst consensus recommendations trending positive, Rogers continues to demonstrate solid fundamentals. For detailed valuation analysis and growth projections, explore the comprehensive Pro Research Report available on InvestingPro.

Executive Commentary

CEO Tony Staffieri highlighted the strategic value of Rogers’ sports and media assets, stating, "Our collection of sports and media assets has a value in excess of 15 billion dollars and is among the most impressive in the world." CFO Glenn Brandt expressed confidence in the wireless segment, asserting, "We expect wireless service revenue to grow, period."

Risks and Challenges

• Competitive pricing pressures in the wireless market
• Low immigration rates impacting subscriber growth
• Potential economic downturns affecting consumer spending
• Regulatory changes in the telecommunications sector
• Technological advancements by competitors

Q&A

During the Q&A session, analysts focused on the competitive landscape in the wireless sector and the development of Rogers’ satellite-to-mobile service. Executives also addressed potential monetization of sports assets and reaffirmed their commitment to maintaining control of these valuable resources.

Full transcript - Rogers Communications Inc (RCI) Q3 2025:

Conference Operator: Thank you for standing by. This is the conference operator. Welcome to the Rogers Communications Inc. third quarter 2025 results conference call. As a reminder, all participants are in listen-only mode, and the conference is being recorded. Following the presentation, we’ll conduct a question and answer session. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may reach an operator by pressing star then zero. I would now like to turn the conference over to Paul Carpino, Vice President of Investor Relations with Rogers Communications. Please go ahead, Mr. Carpino.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thank you, Gaylene, and good morning, everyone, and thank you for joining us. Today, I’m here with our President and Chief Executive Officer, Tony Staffieri, and our Chief Financial Officer, Glenn Brandt. Today’s discussion will include estimates and other forward-looking information from which our actual results could differ. Please review the cautionary language in today’s earnings report and in our 2024 annual report regarding the various factors, assumptions, and risks that could cause our actual results to differ. With that, let me turn it over to Tony to begin.

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: Thank you, Paul, and good morning, everyone. It’s been quite a week for our Toronto Blue Jays, American League champions, so I just wanted to say a few words about Canada’s team. We’re thrilled. The Blue Jays are in the World Series, and it all starts north of the border tomorrow. As owner, our job is to give leadership the tools and resources to win. As Canada’s communications and entertainment company, we’re about providing Canadians with the best sports and entertainment experiences. This is one of those moments, and this is what Rogers is all about. Let me now turn to the quarter. Q3 was another strong quarter for Rogers. We delivered industry-best combined mobile phone and internet customer additions. We continued to grow our cable business, anchored by Canada’s most reliable internet. We again delivered the best wireless and cable margins in our sector.

We’re seeing healthy revenue growth from our media operations through organic growth and through now including MLSE revenue in our results. Overall, we executed with discipline and a clear focus on driving growth across our three main businesses. Let me start with wireless. In the highly competitive wireless market, we saw some pressure on service revenue and ARPU. Our priority continues to be on the consistent delivery of results. We added 111,000 total mobile phone net additions in Q3, and year to date, we added 206,000 mobile subscribers, with the vast majority on the Rogers postpaid brand. We are leading the industry with innovative, transparent, feature-rich, at-a-line plans. These plans meet the dual objective of providing customers with simple value-add options while targeting revenue growth opportunities to support strategic investments in our network. We are also leading the industry with satellite-to-mobile.

This new groundbreaking technology connects Canadians in remote areas, and we now deliver three times more coverage than any other carrier in Canada. Since launching our beta trial in July, we have seen terrific response from both our customers and Canadians. We recently extended the beta trial and will launch even more capabilities in the coming months. The launch of satellite-to-mobile reinforces our 65-year history of leading the industry and innovating for Canadians. Our customers are embracing the strategic approach. Our postpaid churn in the quarter was 0.99%, down 13 basis points year on year, and the lowest churn in over two years. We are leading in innovation and delivering more value for our customers while maintaining industry-leading wireless margins of 67%. In cable, growth remains positive, reflecting a clear reversal of the negative trends seen in previous years.

Retail internet additions were 29,000 in the quarter, and we have delivered approximately 80,000 new internet subscribers year to date across the country. This is in part driven by Rogers’ leading 5G home internet technology. 5G home internet is one of many areas where we’re leading. With the Xfinity roadmap, we’re rolling out new features and plans that drive value and deliver new innovations on our world-class entertainment platform. We’ve launched Rogers Xfinity StreamSaver to bring together popular streaming services at a price point that’s attractive to the consumer. We’ve launched more smart home devices and new features for Rogers Xfinity self-protection. We were the first Canadian internet provider to introduce Wi-Fi 7, the latest generation of Wi-Fi technology. Our focus on execution, efficiency, and discipline continues to drive industry-leading cable margins of 58%.

Finally, in media, revenue growth was up 26%, driven by a strong Blue Jays regular season and the consolidation of MLSE results. We are in the early stages of transforming our sports and entertainment business into one of the best sports businesses globally. This is our third pillar of growth beyond wireless and cable and will be meaningful to Rogers over time. With the acquisition of the additional stake in MLSE, we have added revenue and profitability growth to our core business. Taking a step back, in calendar 2025, we project media revenue and adjusted EBITDA, including MLSE for the full year, to be $4 billion and $250 million, respectively. Our collection of sports and media assets has a value in excess of $15 billion and is among the most impressive in the world. This value is not currently reflected in our share price.

We are well positioned to surface this significant, unrecognized value for Rogers shareholders over time. In 2026, we expect to acquire the outstanding minority stake in MLSE as part of this process, so more to come on this. We are building a sports business at scale, and we are assessing multiple options to unlock additional value. We will take the time to be thoughtful, deliberate, and get it right. In the meantime, we will continue to operate with financial discipline while providing team leadership with the tools and resources to build championships. Finally, on balance sheet and capital spending, we are effectively managing leverage down even as we scale up our exceptional asset base. In Q3, we continue to execute on our commitment to maintain a strong balance sheet. We reported a debt leverage ratio of 3.9 times.

This was achieved after completing the acquisition of the additional stake in MLSE. As you saw this morning, we now expect CapEx for the current year to come in at $3.7 billion. This is below our previous target of $3.8 billion and reflects the current regulatory environment. Free cash flow is now expected to be between $3.2 billion and $3.3 billion, higher than our previous target. In the coming quarters, we will maintain our laser-like focus on preserving a strong investment-grade balance sheet even as we complete our transformational investments. As we pursue growth in our three core businesses, we will continue to align capital spending and free cash flow growth to the best growth opportunities and balance sheet deleveraging priorities. As we get ready for peak selling in the fourth quarter, we will remain focused on balancing execution discipline with revenue and subscriber growth.

Thank you to our exceptional team for their continued commitment to drive growth long term. I will now turn the call over to Glenn.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thank you, Tony, and good morning, everyone. Thank you for joining us. We are pleased to report that Rogers’ third quarter results reflect another quarter of strong, disciplined, and leading financial and operating performance. Once again, we have delivered industry-leading margin performance in cable and wireless, and our wireless churn is the best we have seen in over two years. We have delivered positive cable revenue and adjusted EBITDA growth, and we expect that our combined internet and wireless loading will once again lead our peers. Media has once again delivered sector-leading growth, driven by our added Warner Discovery media content and by our Toronto Blue Jays’ very strong regular season performance. This is the first quarter in which MLSE results are now fully consolidated with our Rogers sports and media business segment.

We are pleased to report that Rogers is delivering solid results across all three core businesses against the backdrop of a competitive environment and slower growth economy. Starting with wireless, we continue to deliver solid market share supported by disciplined financials. Wireless service revenue was flat, and adjusted EBITDA was up 1% year over year, primarily reflecting the ongoing competitive intensity in the marketplace, continued lower immigration, and lower international roaming and wholesale revenue. Our sustained emphasis driving cost efficiencies has moved our industry-leading wireless margin to 67%, up 60 basis points against the prior year and near our all-time high of 68%. We have maintained strong market share for mobile phone net additions, adding 111,000 net new subscribers, consisting of 62,000 postpaid and 49,000 prepaid mobile customers. Across the entire sector, wireless subscriber additions continued lower versus prior year, reflecting continued lower immigration levels.

Against this lower growth backdrop, we have added a sector-leading 206,000 net new mobile phone customers year to date, with the majority of these subscribers added on our feature-rich Rogers premium service plans. Continued emphasis on responsive customer service and improved customer base management has lowered customer churn to a very strong 0.99%, our best churn performance in over two years. Blended mobile phone ARPU of $56.70 is down 3% from the prior year, reflecting the ongoing impact from competitive intensity combined with lower international and wholesale roaming revenue, as mentioned earlier. Moving to cable, cable service revenue has once again grown 1% year over year, driven by retail internet subscriber growth combined with continued discipline in the face of ongoing market competition. Cable adjusted EBITDA is up 2% year over year, driven by the flow-through of modest service revenue growth combined with our ongoing cost efficiency initiatives.

As a result, cable margins have reached an industry-leading 58%, an increase of 70 basis points over the prior year. Internet net additions of 29,000 customers reflect our continued success expanding subscribers throughout our national footprint and includes our continued success with 5G home internet, expanding our bundled service offerings into every region from coast to coast. Finally, Rogers sports and media revenue of $753 million was up by 26% over the prior year, reflecting the combined contributions of three key initiatives: our added Warner Discovery suite of media content, stronger results for Sportsnet and the Toronto Blue Jays, particularly through September to close out the regular season, and the consolidation of MLSE effective July 1.

Media EBITDA was $75 million compared to $136 million last year, reflecting both the positive flow-through of Warner Discovery and the Blue Jays’ regular season, offset by the seasonally low third-quarter EBITDA loss for MLSE, which is consolidated in 2025 but not in 2024. We expect MLSE will be substantially accretive to earnings in Q4 and for the second half of 2025. The Blue Jays’ very successful MLB playoffs and World Series run will provide further added growth in the fourth quarter. In terms of unlocking additional value from our sports and media assets, let me recap our current view on process and timing. To be clear, we remain determined and committed to delivering our balance sheet and to unlocking the significant unrecognized value in the RCI share price from these world-class sports assets.

With a current estimated value of more than $15 billion for our sports and media properties, we continue our work to identify and execute on the best long-term strategy to surface value. The way our Toronto Blue Jays’ World Series run is captivating this country is a very clear demonstration of the power of our iconic sports teams. We anticipate a transaction could occur over the next 18 months or so, likely coincident with or subsequent to us acquiring the remaining 25% minority interest in MLSE. In the meantime, as we assess multiple options, our sports and media operations remain highly successful. They operate at scale and are delivering sector-leading and growing financial results and investment returns. Finally, rounding out my comments on the third quarter, our consolidated service revenue is up by 4% to $4.7 billion, and adjusted EBITDA is $2.5 billion, down 1%.

As mentioned earlier, the year-over-year changes in both service revenue and EBITDA reflect the flow-through of modest growth in wireless, cable, and media combined with consolidation of MLSE results starting this quarter. Capital expenditures were $964 million, which is relatively flat to last year, even as we absorbed some additional capital spending from consolidating MLSE. Free cash flow of $829 million was down 9%, driven by increasing taxable income and the timing of tax installment payments. We continued to deliver in Q3, even as we acquired our additional stake in MLSE for $4.7 billion, roughly a half-turn increase in leverage at acquisition.

Immediate execution on driving operating synergies and MLSE EBITDA growth, combined with ongoing application of free cash flow and capital initiatives to deliver, allowed us to close the quarter with debt leverage of 3.9 times, down roughly 10 to 20 basis points in the first three months of the MLSE acquisition. Notwithstanding this notable progress, our third-quarter leverage is up by 0.3 times as a result of the MLSE acquisition. Here, I will emphasize that we remain committed to strengthening our balance sheet further and to improving our investment-grade credit ratings. We are in regular contact with each of the credit rating agencies to communicate our plans and progress. This will be driven by continued prudent capital priorities, together with earnings and free cash flow growth to pay down debt and lower leverage. Unlocking value from our sports and media holdings is a very substantial part of that exercise.

At quarter end, we maintained our very strong liquidity position, with available liquidity of $6.4 billion. This included $1.5 billion in cash and cash equivalents and $4.9 billion available under our bank and other credit facilities. As you have seen in our Q3 free cash flow statement issued today, we are now reporting distributions paid by subsidiaries to non-controlling interests, reflecting the distribution payment associated with the minority investment and a portion of our wireless network infrastructure. The $14 million amount reflects the prorated timing for the transaction, which closed in late June, and the Q3 distribution is for a partial prior quarter. In our Q4 results and going forward, the full quarterly amount of the distribution will be reflected, which we anticipate will be approximately $100 million per quarter.

As we discussed last quarter, a very substantial portion of this quarterly distribution is offset by the lower interest expense generated from using the proceeds from this transaction to pay down debt. The last piece I will touch on before we open up the call for Q&A is for affirmation and updates to our 2025 guidance, where we have improved our outlook for both capital expenditures and free cash flow for the rest of the year, reflecting our ongoing efforts to drive more efficient capital allocation and also reflecting the current regulatory environment. We now expect to end 2025 with capital expenditures of approximately $3.7 billion, which is a further $100 million reduction to our previous adjusted target of $3.8 billion and a full $300 million improvement from the previously anticipated high end of our guidance range announced in January, when we were targeting $3.8 billion to $4 billion.

Notably, we are improving our targeted capital outlook even as we absorb the additional capital expenditures associated with MLSE. We have driven careful prioritization of our capital investments in 2025, and you should expect this determined prioritization to continue in 2026. We now expect our 2025 free cash flow to be in the range of $3.2 billion to $3.3 billion, compared to the $3.0 billion to $3.2 billion range previously estimated at the beginning of the year. As we prepare for 2026 and beyond, you should expect that we will continue to drive more efficient capital investment, improve free cash flow, and further strengthen and deliver the balance sheet. In summary, our Q3 results demonstrate that Rogers Communications continues to successfully execute on its core wireless and cable strategies.

We have achieved consistent, strong performance for almost four years now, and we will continue to build on this track record in the quarters and years ahead. In sports and media, we continue to make progress on our very unique opportunity to surface significant unrecognized value from these assets for our shareholders. In the meantime, we continue to pursue sector-leading growth and improve profitability for Rogers sports and media. Let me close by extending a very sincere and appreciative thank you to our employees, who are the engine driving and sustaining our strong execution and who play a critical role in driving our future success. Thank you for your tremendous pride and determination. Go Jays. I will now ask Gaylene to open the call for our Q&A session. Thank you.

Conference Operator: Thank you. We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You’ll hear a tone acknowledging your request. If you’re using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. First question is from Stephanie Price with CIBC. Please go ahead.

Hi, good morning. I was hoping you could talk a little bit more on the wireless competitive environment as we head into the holiday season, and if you think the current pricing environment can be sustained here.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Morning, Stephanie. Thanks for the question. In terms of, you know, we approached back to school with a view of having very simple redefined value propositions for the customer. We streamlined our price offerings. We made it more clear on the differentiation amongst the plans with features that are beyond just data bucket sizes. What we found is it resonated well. We focused on at-a-line construct so that we could increase the number of lines per customer, and that’s trending well for us as well. We recently introduced tiered hardware promotional discounts so that the amount of discount on a hardware is graduated depending on the plan that the customer comes in on or is on, if they’re currently customers today. What we’re finding is that’s resonating extremely well with customers, and you’re seeing that in our subscriber performance. That’s been continuing throughout October as well.

We think we’ve got the right value proposition as we head into Black Friday and to the end of the year. That’s what you should expect to see from us. We’ll see how the marketplace responds, and to the extent we need to pivot based on the market dynamics, then we’ll do so. Right now, we’re feeling pretty good about the pricing constructs that we have in the marketplace.

Thank you. Maybe a follow-up on churn. Your churn has been down over the past two quarters. Great to see, and hoping you can give us some thoughts on churn management and where there’s further opportunities potentially.

Yeah, what you’re seeing is a very concerted effort. We’ve always focused on base management, but we’ve taken a much more holistic approach to base management and employing tactics that are resonating with customers in terms of what’s important to them, drilling down on customers that we think might have a propensity to churn and dealing with the issues in advance of them calling us. There are a number of tactics that we’ve been going through, and the team is executing extremely well in base management. We expect to continue to see good churn performance across our entire base.

Thank you so much.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Great. Thanks, Stephanie. Next question, Gaylene.

Conference Operator: The next question is from Aravindra Galapatike with Canaccord Genuity. Please go ahead.

Good morning. Thanks for taking my question. I wanted to start off with wireless. Obviously, you know, the lag effect of the historical promotional activity continues to show in the service revenue numbers. When you’re just looking at the sequential trend in service revenue growth, I wanted to clarify whether there were items around roaming or external customers that would have had an impact on that number.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Thanks, Aravindra. Yes, the part of that decline really is lower roaming volumes, as well as a reference to some wholesale revenues that I’ll shortcut and simply say move to another carrier. You’re seeing that roll through. That’s a very substantial part of what you’ve seen in the revenue.

Thanks. Maybe just a bigger picture question on operating leverage. With the progress that’s made on the AI side of things, the latest generation being Agentic AI and so forth, can you talk about the magnitude of the opportunities that you have to potentially deploy those technologies within the firm and potentially drive streamlining efforts within Rogers, whether it’s in CX or even on the network operations side, marketing, etc.? Just to get a sense of how material that could be from an operating leverage perspective to the company.

Thanks for the question, Aravindra. Really good question and something we’ve been spending quite a bit of time on, not just historically, but as investments in AI tools and technology continue to grow exponentially, we continue to look at ways to capitalize on it. We see, you know, three main areas. One is the customer experience, as you indicated, combining with a completely digital experience, and that’s the journey we’re on. It’s going to allow us to give the customer a more consistent, streamlined experience to address whatever issue they have. We’re really looking forward to that and are much more cost-effective on a much more cost-effective basis. The second relates to efficiency and the ability of these AI tools to make us much more efficient, and some of which you’re seeing already in our industry-leading margins in both wireless and cable.

The third really relates to security and the ability to continue to enhance security for our customers and for our own data. It’s all three of those categories that we’re very much focused on and will continue to deploy. The opportunity for this is significant for us in this sector. We’ll continue to follow, in many ways, the large players globally and the tools that they’ve deployed successfully so that we’re a fast follower in many of these areas and implementing them efficiently.

Thank you. I’ll pass the line.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thanks, Aravindra. Next question, Gaylene.

Conference Operator: The next question is from Drew McReynolds with RBC. Please go ahead.

Yeah, thanks very much. Good morning. Maybe extending the network revenue question, I think, from Aravindra. Glenn, can you talk about just let’s level set expectations about, you know, how that trends, just given all the moving parts, whether you want to talk about Q4 into 2026, just, you know, how are you thinking of the puts and takes and the trajectory? Second question, obviously going to fit in a Jays’ one here on the sports assets. I mean, clearly incredible to see the whole country alive here. Tony, you know, you’ve talked about kind of how these three businesses, you know, have to stand on their own, but clearly there’s a, you know, branding and cross-promotional aspect to this all.

Just wondering, you know, if we would see or have seen direct impacts on your telecom business in terms of, you know, subscriber growth or, you know, benefits that are coming your way on the telecom side that we’d see in either Q3 or Q4 or just, you know, maybe longer term?

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Thanks, Drew. Let me start with the first part of that. I’m not going to take the opportunity to start guiding for 2026. I will say the trends you see, I’ll say through the first three quarters of 2025 and the trajectory of hitting growth on the year for service revenue, we remain firmly committed to and expect. For the year, you’ll see positive service revenue growth for wireless. We all know the competitive framework that we operate in and the slower subscriber growth. That’s why you see us leaning in on base management and churn improvement. That’s a very efficient way of finding, if not revenue growth, certainly sustaining the base of operations. We remain committed to that. Q4, I expect you’ll see strong execution.

Part of our Q3 backdrop is we are lapping a very strong Q3 in the prior year, and we have sustained and held the very fast part of that growth that you saw in 2024 through the first three quarters of 2025. I’m pleased with that progress. Q4 will be another strong quarter. I won’t comment further on guiding for that or beyond in 2026, but pleased with progress for sustaining that base management through the three quarters.

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: Drew, with respect to your second question, as you pointed out, we’re looking to each one of our pillars of growth, being wireless, cable, and now sports and entertainment, to stand on their own and drive value, profitability, and growth in their own respect. We also look to ensure that we’re capitalizing on the cross synergies amongst all our assets. The run of the Toronto Blue Jays and heading into the World Series, you can see that in spades in terms of the ability to enhance our brand, the ability to showcase our cable and wireless products and services to viewers of the game. We’ve seen that throughout the year. If you think about some of the key events in 2025, Four Nations, the playoff run of the Toronto Maple Leafs, and then the Toronto Blue Jays, and there are others as well.

You see the power of live sports, and it’s good to see, and it’s been a benefit for us, as I said, in and of itself, but also in terms of helping the broader Rogers.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thank you. Thank you, Drew. Next question, Gaylene.

Conference Operator: The next question is from Vince Valentini with CIBC. Please go ahead.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Hey, thanks very much. I assume you’re getting a lot of favors and requests for tickets for the World Series. I’m wondering if you can compare that. How many requests are you getting for this versus the Taylor Swift concerts? You don’t have to answer that.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: These are the most World Series requests we’ve had in 32 years.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thanks, Glenn. A very accurate answer, as always. A more serious question. Look, you’ve been asked this several times. I want to hit this head-on. Given pricing is improving in wireless, your front book is now above your back book, and we’ve seen the CPI stats showed a material improvement in September to basically flat for wireless pricing versus double-digit declines earlier in the year. All that should mean that Q3 is the trough quarter for wireless ARPU at -3.2%. Can you not confirm that, that it won’t get worse than that and should gradually get better over the next five, six quarters?

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Succinctly, I agree with your sentiment. I think we are seeing some strong initiatives around a large number of initiatives to sustain the base, low churn, and sustain revenue. Broadly, yes, I think you are seeing us continue solid wireless growth on a full year as well as quarter to quarter. You saw a dip in the third quarter, but all of the elements that you’ve pointed out are true, Vince.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thank you. If I can just sneak in one more, wireless equipment margin was a pretty positive contributor to EBITDA again this quarter. In the past, it hasn’t always been a positive. Has something changed in terms of handset subsidies and the amounts you’re giving out to, or something changed with your deals with the vendors to allow that to be a sustainable source of positive EBITDA?

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: The driver for it in the third quarter was really our shift to the tiered promotional discounting that I spoke about. Although we implemented it later in the quarter, it came at a time with higher volumes with back to school. It was extremely and continues to be very effective in reducing our net hardware costs, but also in incenting the customer to move up tier. When we look at our ARPU in, we’re really pleased with the effect that it’s having. You see ARPU in up very nicely year on year. We like what we see there. It is, we believe, the beginning of a trend in terms of net hardware costs for us.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thank you.

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: Thank you, Vince.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thanks, Vince. Next question, Gaylene.

Conference Operator: The next question is from Maher Yaghi with Scotiabank. Please go ahead.

Great. Thank you for taking my question. Glenn, I just wanted to double-check on something. In the previous question, you said in your response that you agreed with all the assumptions based on the basis of the question, but I’d just be very specific. Are you saying that you confirm that the back book of your wireless service customers is below the current front book?

Unnamed Executive, Wireless Operations Executive, Rogers Communications: I’m answering from a general sentiment of whether or not we are troughing, whether or not wireless service revenue is growing. I’m not getting into the detail of front or back book. You’ve heard me answer these questions consistently, Vince, or Mayor, when we’re asked on what’s ARPU trajectory, I focus on service revenue growth and EBITDA growth. On service revenue growth, I expect wireless service revenue to grow each quarter and each year. We had a slight, and it’s a very slight, decline, just below zero or flat in the third quarter. For the year, we’ll be positive, and I expect we’ll be positive going forward. It’s a mix of subscriber additions, pricing initiatives, service plan initiatives, simplifying our service plan offerings, and trying to move customers up through premium plans. I could go on and on.

I don’t want to talk about front and back book because it makes it seem like there’s a difference between new and long-standing customers. It’s really working with our service plans and our initiatives all around that to drive service revenue and EBITDA growth. Don’t read too much into that. I’m answering from a general sentiment. We expect wireless service revenue to grow, period.

Perfect. Thank you. Thank you for answering this question more precisely, because I think there’s still some gap left to be closed, but I agree with that.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Understood.

Yeah, that there’s upside for next year. I just wanted to ask you, I know it’s not much visible in your results, and I’m not surprised because in Canada, we have a lag to the U.S. in terms of new product introduction. Results from AT&T yesterday and T-Mobile this morning are showing a significant increase in jump balls coming from customers looking to get their hands on the new iPhones. I wanted to just see if you’re noticing thus far in Q4 a slight pickup in jump balls in Canada yet, or if not, why not? How are you positioning yourself for Q4? If we do see the same trend occurring in Canada, do you think handset subsidization will become a bigger factor in the overall economics of floating customers in Q4 versus prior quarters?

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: There are a couple of things that you touched on, and I’ll work backwards from your question. In terms of, you know, in Q4, the demand for new devices and the subsidy and cost for us, what you see in market for us is how we intend to approach the marketplace in the fourth quarter. We think we have very good value proposition, and our promotional incentives are really going to be centered around hardware rather than rate plans. We’re also going to be very disciplined in the tiering constructs that I spoke about earlier, so that higher promotional discounts come with our more premium plans and vice versa. In terms of, to use your term, you know, jump ball that we’re seeing with the launch of the new iPhone device, we’ve seen good demand for it. Our bigger constraint has been supply, frankly, on that front.

That’s been the limiting factor for us, but I would say at the margin. We’re seeing the same type of industry constructs for our business that you described.

Great. Thank you for taking my questions.

Thank you, Mayor.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Next question, Gaylene.

Conference Operator: The next question is from Batia Levi with UBS. Please go ahead.

Great. Thank you. Can you talk a little bit about the competitive environment in terms of if you’re seeing any pickup in go-to-market strategy with converged offerings? From your perspective, can you give us a sense of maybe what % of your broadband base takes the Rogers service as for mobile? What are some benefits you see beyond just churn reduction? Thank you.

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: Thanks, Batia, for the question. Converged offering is something that we’ve spoke about in previous calls and continues to be a competitive advantage for us, frankly, given our wireline and wireless converged footprint. Now with FWA, we’re essentially converged on 100%. Our go-to-market strategy has been to leverage our distribution channels, which are the strongest and frankly the best in the industry here in Canada, and leverage those to offer customers a converged home solution as well as their wireless products. We’re seeing good pickup in that. In terms of the %, we don’t disclose that, but it continues to rise rather rapidly in customers looking for that solution. There are a number of benefits beyond, you know, the converged offer is a bundle discount, a modest discount for it.

There are other benefits that customers see in terms of simplified servicing, having to deal with only one provider, and the convergence of the technologies as that evolves. They see benefit in that.

Got it. Thank you. Just a quick follow-up on the lower CapEx for this year. Can you provide a bit more color on where it’s coming from and also how we should think about capital intensity going forward?

We’ve been very focused on efficiency throughout our operations. You’ve seen it and continue to see it in our operating margins across our cable and wireless businesses. You’ll see it in our media business as well going forward at scale. We’ve also continued to focus on capital efficiency, and that’s what you’re seeing play out there. There are projects that we decided not to invest in as a result of a government decision on TPIA. Certain projects were just not viable and carry too much uncertainty, and it’s disappointing. We’re a company that wants to invest in this country and in infrastructure. When faced with uncertainty that those types of decisions create for us, we have no choice but to pull back on capital investment, and you see that impacting the total dollars.

In terms of going forward, you should expect us to continue to look for improved efficiencies and ways of continuing to reduce our capital intensity across our businesses.

Got it. Thank you.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thanks, Batia. Next question, Gaylene, please.

Conference Operator: The next question is from Jerome Dubreuil with Desjardins. Please go ahead.

Hey, good morning. Thanks for taking my question. The first one, I just want to hear maybe more about the financing plan for the Kilmer deal, which we understand is coming. Glenn, you mentioned that there’s been credit rating agencies’ discussion. I’m sure they’re aware. If you can comment on the plan, maybe to bridge a gap just so the market is ready and we don’t have to start over with the balance sheet questions when the Kilmer deal comes.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Thank you, Jerome. What we’re focused on is first acquiring the remaining 25% minority stake, combining the operations, and then proceeding with recapitalizing the combined Rogers sports and media, including MLSE and Blue Jays’ entity. That could happen very shortly on the heels of acquiring the minority stake, or it could happen sometime following that. We’re guiding towards within the next 18 months. I do anticipate it could well be in 2026, which is just inside 18 months now that we’re standing in October. It’s over a timeframe that is going to take some time to work through the acquisition of the 25% stake. Over the course of that exercise, we are working with our analysis to figure out how best to capitalize that combined entity. It’s going to depend upon the arrangements that we strike with the minority shareholder on buying out their stake and just when that comes.

Tremendous interest is being expressed by potential institutional investors. They are an extremely attractive set of assets. We are working with the credit rating agencies, so they are aware of our timing. You heard me mention on the second quarter call, critical for us was getting our arms around the Shaw delivering at mid-year before and then embarking on this MLSE consolidation with RSM and recapitalization. That allows the calendar to be reset, gives us time to fill in those details. I’ll quickly draw to a conclusion then, Jerome, that I’m not going to give you the roadmap on exactly how much we’re selling down and to whom because I don’t want to pre-announce. I don’t have anything to pre-announce. I do know we have assets that are worth more than $20 billion once we combine it all and tremendous interest in buying in.

We have shown time and again, most recently with the Shaw acquisition, our ability to deliver. We are absolutely focused on that exercise, and we have a tremendous value of assets here to do that with. I’m highly confident on our execution.

That’s great, Glenn. If I can just go more specifically on this, if I can summarize, there is that credit rating agencies are aware we’re not going to need any equity to bridge a gap probably. I know the answer to that question, but it would be great to have it out there.

Yes, succinctly, yes. They are aware we have time to execute. They know we are committed to executing on this. I have been managing our credit ratings and our capitalization and capital structure and funding as a primary part of my role for coming up on 34 years now. I’ve been working with these credit rating agencies throughout that 34-year period. They’re well aware of our intentions and our capabilities.

Great. Thank you.

Thank you, Jerome.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Great. Gaylene, we have time for two more questions, please.

Conference Operator: Thank you. The next question is from Matthew Griffiths with Bank of America. Please go ahead.

Yeah, hi. Thanks for taking the question. Just on the sports, in the past, if I’m not mistaken, it’s been a priority to consider control of the assets following the transaction. That hasn’t been brought up this morning, but I just wanted to see if that remains kind of one of the priorities that you’re factoring in in addition to the kind of shareholder return maximization from any potential deal 18 months down the road. Separately, just on wireless, on the cost side, in the release, it was mentioned the launch of the satellite-to-mobile service was one of the items called out for increased cost. I just was curious if that was mostly a marketing-related comment or if it’s related to the payment to the partner or a combination of both. What exactly is that referring to?

Because I know it’s so early days, so I just wanted some clarity if it’s possible. Thanks.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Thank you, Matt. Let me start with the sports side of it. I’ll answer it quickly with just a reference back to the asset value within our sports holdings is, as I’ve said, somewhere in the range of once we own 100% of everything, Blue Jays and RSM operations today, plus MLSE. We’ve indicated we think the value of that is over $20 billion. If we were to sell a majority stake, that would be raising north of $10 billion. I don’t need $10 billion of equity improvement in the RCI balance sheet. I do expect we will maintain control simply because the exercise is not that large and these assets are very valuable. We do anticipate we will control these assets.

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: Okay. In the second part of your question, Matt, in terms of our wireless operating costs, you’re referring to the comments made in the press release. Year on year, we’ve had a very modest increase in operating costs, and you see it in the disclosures of about $8 million. It’s a combination of several factors. One of those factors that is described is the satellite-to-mobile service initiative. As you rightly point out, it does encompass both the marketing as well as the fee paid for the service under our contract. We are currently in the beta trial mode. We’ve extended the beta trial mode to allow the commercial launch to be coincident with the launch of new feature capabilities of the satellite. Right now, it is just testing, but very soon, we’re pleased to announce and see that it’ll include data as well.

That’s the reason for extending the beta trial before we get to commercial launch. You don’t see any of the revenue pickup in our Q3 results, and you won’t see it until we move to commercial launch.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thanks so much.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Thank you, Matt.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Final question, please, Gaylene.

Conference Operator: The next question is from David McFadien with Cormark Securities. Please go ahead.

Great. Thanks, sir. Thanks for feeding me in. Maybe just following on the Rogers satellite-to-mobile service for a second. Right now, this texting, you expect to add data. I guess that would be a light data plan. Do you have any ideas when you’d be able to offer, you know, text, voice, and just full data?

Tony Staffieri, President and Chief Executive Officer, Rogers Communications: Yeah, thanks for the question, David. On launch, again, to reiterate, it was texting, including 911 texting in terms of capability. We are extremely pleased with the advancement of the roadmap. Data was not going to come until next year, and voice was planned for the year after that. As a result of the work that our partner has been doing at a very rapid pace, we’re pleased that this quarter, what we will have for our customers is the ability to use data and apps. As you describe, it’ll be somewhat light data. We’ll see the capability in terms of bandwidth once it’s into production. We’re really excited about that. The next to follow is voice. We don’t have something we can disclose on that, but you should expect it at some point in 2026.

Okay, can you give us any idea on the number of people that have signed up for the trial so far?

It’s received terrific demand from our customers and Canadians broadly in signing up for it. As you can imagine, just given our topography and landscape here in Canada, there are significant areas that weren’t covered by any wireless network, including some major highways. The use case for it is significant, and what we’re seeing is very good pickup. It’s a material amount. What I can tell you, it’s over $1 million, but we’re not disclosing the specific number because we don’t want to get too far ahead of ourselves in trying to extrapolate what kind of revenue that means.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: One of the real opportunities here for us, David, is that it covers the very remote regions of the country. It covers virtually every road and highway. There’s the individual Canadians that are signing up. The enablement of this for businesses is tremendous, and the opportunity for us is tremendous.

The fact that you’ve had over $1 million sign up, that’s pretty darn good. If I could squeeze in one more, just on the wireless side. If we don’t see any change in immigration, immigration stays at the current levels, do you think your wireless net adds would be similar next year or higher or lower?

I think let me avoid guiding for next year, but I would say if I look at 2025, even with very, very low immigration, our growth is in the range of 3% for the sector, for the industry. 3% growth is roughly a million adds for the industry. I would expect that to continue until immigration turns up again. It will at some point. I don’t expect that in 2026. It would be wonderful if it did, but it will come back at some point. We will look to growing the population again, I expect. That’s a key part of economic growth for any country. 3% growth in the base is certainly something we can still build on.

Okay, okay. Thanks a lot.

Thank you, David.

Paul Carpino, Vice President of Investor Relations, Rogers Communications: Thanks, David. Thanks everyone for joining us. If there’s any follow-up, please feel free to reach out and have a great day.

Unnamed Executive, Wireless Operations Executive, Rogers Communications: Thank you all. Go Jays.

Conference Operator: This brings to a close today’s conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

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