‘Uncertainty’ weighs on Telus results, but company hopeful AI can bring new revenue

Telus Corp. headquarters is seen in downtown Vancouver. THE CANADIAN PRESS/Darryl Dyck

VANCOUVER — Telus Corp. reported its first-quarter profit fell amid a “dynamic” operating environment as the company says its focus remains on generating free cash flow, moderating its capital expenditures and finding other efficiencies.

The company said it earned a profit attributable to common shareholders of $136 million or nine cents per share for the quarter ended March 31. The results compared with a profit of $321 million or 21 cents per share in the same quarter last year.

On an adjusted basis, Telus earned 23 cents per share in its latest quarter compared with an adjusted profit of 26 cents per share a year earlier.

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The level of competition throughout the industry was “more intense in Q1 than we’re used to,” said Telus chief financial officer Doug French in an interview, echoing the company’s peers.

French said Telus responded to wireless promotional discounting “with a measured approach focused on preserving our premium Telus brand.” He called it a “very good quarter, considering the competitiveness.”

“I think it was a continuation from the holiday season and ... just a little bit of the uncertainty and slowdown in the market,” he said.

“It’s an environment that isn’t as predictable as it used to be.”

French also pointed to the slowdown in immigration as a key factor limiting new subscriber growth.

Telus’ operating revenue and other income totalled $5.01 billion in the quarter, down from $5.06 billion a year earlier.

The results came as its total telecom subscriber connections for the quarter rose to 17.7 million, up from 16.7 million in the first quarter of 2025.

Telus said it added 12,000 net mobile phone subscribers in the quarter, down 8,000 year-over-year, reflecting an increase in its mobile phone churn rate.

Its churn rate -- a measure of subscribers who cancelled their services -- was 1.35 per cent in the first quarter, compared with 1.06 per cent a year ago, due to “customer switching decisions in response to continuing marketing and promotional price competition.”

That included a churn rate of 1.06 per cent for postpaid mobile service -- those who pay a monthly wireless bill after charges have accumulated.

Its mobile phone average revenue per user was $56.56 in the first quarter, a decrease of 57 cents or one per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in roaming revenues and the commoditization of telecom services in the public sector.

Telus reported it signed up 21,000 net internet customers, unchanged from the first quarter last year.

There were 229,000 connected device net additions, an increase of 81,000, reflecting customer growth in the transportation and connectivity industries.

“The telecom business continues to feel the pressures of elevated competitive forces in Canada, which was also reflected in Rogers’ and BCE’s results,” said Scotiabank analyst Maher Yaghi in a note.

“While gross loading came above our expectations, churn elevation caused net loading to miss our estimates. We believe it will be imperative for the company to control its churn rate in order to stabilize future operational results in wireless.”

AI data centres highlight new revenue streams

Telus’ free cash flow grew 19 per cent year-over-year in the quarter as the company said it realized annualized free cash flow synergies of approximately $115 million.

Chief executive Darren Entwistle said those efficiencies come from initiatives such as accelerated AI-driven automation, business simplification and cross-promotion of services.

He said Telus Digital “is uniquely positioned to provide Telus and our clients complete end-to-end AI solutions.”

“Indeed, with these unique capabilities across the entire value chain of AI, we have created prescient and meaningful new revenue streams for Telus,” Entwistle said during the company’s annual general meeting.

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He said the company’s AI data centre in Rimouski, Que., which launched last September, is now sold out, which “clearly validates the strong market demand for sovereign AI infrastructure and compute capability.”

He added Telus plans to expand its AI compute capacity with a second data centre set to open in Kamloops, B.C., in the near future.

Meanwhile, Telus announced Friday that French will retire on June 30 after three decades with the company. Gopi Chande, currently chief financial officer of Telus Digital and Telus Health, will takeover the role effective July 1.

“Doug has had a truly extraordinary career,” said Entwistle, who is also set to retire June 30.

“As one of North America’s most respected and experienced CFOs, Doug leaves behind him an extremely impressive legacy of success. He is truly one of a kind and we will miss him dearly.”

This report by The Canadian Press was first published May 8, 2026.

Sammy Hudes, The Canadian Press