TELUS Q1 Net Income Halves, Dividend Growth Paused; CFO to Retire
TU is trading near its 52-week low of $11.69 (9.2% above the low).
Summary
TELUS reported a 52% decline in Q1 net income and a pause in its dividend growth program, despite flat adjusted EBITDA and improved free cash flow, while also announcing a CFO transition and a strategic review for its TELUS Health business.
Key Events · Earnings and Guidance · TU
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Q1 Net Income Plunges 52%
Net income for Q1 2026 decreased by 52% to $144 million from $301 million in Q1 2025, with basic EPS falling 57% to $0.09 from $0.21.
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Dividend Growth Program Paused
The company announced a pause in its multi-year dividend growth program, maintaining the quarterly dividend at $0.4184 per share.
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Adjusted EBITDA Remains Flat
Adjusted EBITDA for Q1 2026 was $1,837 million, relatively unchanged from $1,841 million in Q1 2025.
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Net Debt to EBITDA Ratio Improves
The net debt to EBITDA (excluding restructuring and other costs) ratio improved to 3.5 times at March 31, 2026, down from 3.9 times a year earlier.
Analysis · TU · Technology
TELUS reported a significant 52% decline in Q1 net income and a 57% drop in basic EPS, falling short of prior year results. The company also announced a pause in its dividend growth program, maintaining the current quarterly dividend. While adjusted EBITDA remained flat, free cash flow increased by 19.5%, and the net debt to EBITDA ratio improved from 3.9x to 3.5x, indicating better financial leverage. A key executive change was announced with CFO Doug French's retirement and Gopi Chande's appointment. Strategically, TELUS has initiated a program to identify potential partners for its TELUS Health business, which could unlock value. However, the regulatory environment presents competitive challenges, notably the CRTC's mandate for wholesale fibre access. The company also revised its 2026 outlook, increasing restructuring costs but lowering cash income tax payment expectations.
At the time of this filing, TU was trading at $12.76 on NYSE in the Technology sector, with a market capitalization of approximately $20.1B. The 52-week trading range was $11.69 to $16.74. This filing was assessed with negative market sentiment and an importance score of 8 out of 10.