Q2 2024 BCE Inc Earnings Call

Speaker Change: You are in listen only mode. If you wish to ask a question, dial star 1. I would now like to turn the meeting over to Mr. Thane Fotopoulos. Please go ahead, Mr. Fotopoulos.

You are in listen-only mode.

Operator: If you wish to ask a question, dial star one.

Operator: I would now like to turn the meeting over to Mr. Thane Fotopoulos. Please go ahead, Mr. Fotopoulos.

Thane Fotopoulos: Thank you, Matthew.

Thane Fotopoulos: Good morning, everyone. Thank you for joining our call.

Thane Fotopoulos: Listen to me here today, our Mirko Bibic, President and COBC, in our CFO, Curtis Millen. You can find our Q2 disclosure documents on the Investor Relations page of the BCE.ca website, which we posted.

Speaker Change: Thank you, Matthew. Good morning, everyone, and thank you for joining our call with me here today, our Mirko Bibic.

Speaker Change: President and CEO of BC and our CFO , Curtis Millen. You can find our Q2 disclosure documents on the investor relations page of the bce.ca website, which we posted earlier this morning. Before we begin, I want to draw your attention to our safe harbor statement on slide 2 of the analyst presentation, reminding you that today's.

Thane Fotopoulos: Earlier this morning, before we begin, I want to draw your attention to our safe harbor statement on slide two of the analyst presentation, reminding you that today's presentation and remarks made during the call will include forward-looking information. And therefore our subject to risks and uncertainties; results could differ materially. You can explain any obligation to update forward-looking statements, except as required by law. Please refer to BCE's publicly filed documents for more details on our assumptions and risks.

Mirko Bibic: With that, I'll turn it over to Mirko.

Mirko Bibic: Thank you, Thane, and good morning, everyone. So looking at our overall second quarter operating results, the Bell team managed well, and we executed with financial discipline against the backdrop of a highly competitive marketplace. We have a clear vision for how we're competing now and into the future, combined with our proven trademark consistent execution. While consolidated top line growth continue to be impacted by sustained competitive pricing pressures and expected revenue loss from the source. We remain laser focused on profitable, margin accretive subscriber growth and driving costs out of the organization. As you can see by 2% EBITDA growth in Q2 and a 1.3 point increase in BCE's margin to 44.9%.

Unknown Executive: Thank you Thane, and good morning everyone. So looking at our overall second quarter operating results, the Bell team managed well, and we executed with financial discipline against the backdrop of a highly competitive marketplace. We have a clear vision for how we're competing now and into the future, combined with our proven trademark of consistent execution. While consolidated top-line growth continued to be impacted by sustained competitive pricing pressures and expected revenue loss from the source, this contributed to $1.1 billion of free cash flow being delivered in Q2, which represents an increase of 8% over last year and aligns with the expectations we shared with you on our Q1 conference call in May for higher free cash flow generation as profiled in our quarterly budget at the start of the year.

Mirko Bibic: Both of these results were higher than forecasted, demonstrating our success in driving efficiencies and reducing costs to offset near-term competitive and economic pressures. This contributed to 1.1 billion dollars of free cash flow being delivered in Q2, which represents an increase of 8% over last year and aligns with the expectations we shared with you on our Q1 conference call in May for higher free cash flow generation as profiled in our quarterly budget at the start of the year. As for operating results, our CTS segments subscriber metrics continue to be underpinned by leading broadband fiber network that is consistently recognized by third parties for investment cost performance and customer experience by mobile 5G speed that are being further enhanced with deployment of 3,800 megahertz spectrum, as well as increased customer bundling of mobility and Internet that serves as an important term management and value driver tool.

Mirko Bibic: In wireless, we were arguably the most disciplined and striking the right balance between volume growth and economics in a heightened competitive pricing environment. We managed our promotional offers prudently to deliver a healthy step up and new subscriber activations that focused on higher quality main brand loadings. In fact, Bell has led the charge of more rational pricing behavior, increasing the rates on a number of fell mobility and Virgin Plus plans at the beginning of July while continuing to deliver exceptional value to our customers. Collectively, total post paid and prepaid mobile phone that adds in Q2 were up 4.4% to 131,043.

Speaker Change: In wireless we were arguably the most disciplined and striking the right balance between volume growth and economics, and a heightened competitive pricing environment. We.

Unknown Executive: In wireless, we were arguably the most disciplined in striking the right balance between volume growth and economics in a heightened competitive pricing environment. In fact, BELF has led the charge on more rational pricing behavior, increasing the rates on a number of BELMobility and Virgin Plus plans at the beginning of July, while continuing to deliver exceptional value to our customers.

Speaker Change: We managed our promotional offers prudently to deliver a healthy step up in new subscriber activations that focused on higher quality main brand loadings. In fact, <unk> has led the charge of more rational pricing behavior, increasing the rates on a number of bell mobility and Virgin plus plans at the beginning of July while continuing to.

Speaker Change: Liver exceptional value to our customers.

Speaker Change: <unk> total postpaid and prepaid mobile phone net adds in Q2 were up four 4% to 131043.

Mirko Bibic: And with robust Canadian population growth projections and even greater focus on bundling wireless and consumer Internet service, we see good runway for continued. Mobile subscriber growth also included connected device net ads of approximately 88,000. That's up 10.5% over the prior year and reflects continued strong momentum for our 5G and IoT B2B solutions. In residential wireline, we continue to gain a significant share of new Internet subscriber growth. And that's fueled by our fiber, by our fiber network, superior symmetrical speeds, and overall customer experience. Which drove our highest Q2 consumer retail internet net ads in 17 years and an 18% increase in households subscribing to mobility and internet service bundles, and that's where we have fiber.

Unknown Executive: And with robust Canadian population growth projections and an even greater focus on bundling wireless and consumer internet service, we see good runway for continued growth. In Residential Wireline, we continue to gain a significant share of new internet subscriber growth, and that's fueled by our fiber network's superior symmetrical speeds and overall customer experience, which drove our highest Q2 consumer retail internet net ads in 17 years and an 18% increase in households subscribing to mobility and internet service bundles. And that's where we have fiber. And investments to sustain the strategic shift to digital will continue.

Speaker Change: And with robust Canadian population growth projections, and even greater focus on bundling wireless and consumer Internet service, we see good runway for continued growth.

Speaker Change: Mobile subscriber growth also included connected device net adds of approximately 88000, that's up 10, 5% over the prior year and reflects continued strong momentum for our <unk> and Iot B to B solutions.

Speaker Change: In residential wireline, we continue to gain a significant share of new internet subscriber growth and thats fueled by our by our fiber network superior symmetrical speeds and overall customer experience, which drove our highest Q2 consumer retail internet net adds in 17 years at an 18%.

Speaker Change: <unk> increase in household subscribing to mobility, and Internet service bundles, and Thats, where we have fiber.

Mirko Bibic: Notably, 41% of our new internet customers this quarter subscribe to a service bundle with wireless, which should help drive better subscriber lifetime value and improved retention longer term.

Speaker Change: Notably, 41% of our new Internet customers this quarter subscribe to a service bundled with wireless which should help drive better subscriber lifetime value and improve retention longer term.

Mirko Bibic: Turning out of media, Bell Media continues to transform from a traditional broadcaster to a digital media and content leader. And a prime example of that is the advanced advertising solutions for clients powered by Bell first party data, including Bell Analytics, the Sam TV sales tool, Bell DSP, addressable TV, and Crave with ads, which together collectively drove a 35% increase in digital advertising revenues this quarter. And investments to sustain the strategic shift to digital will continue. We announced a number of new partnerships and additions to our ad offerings at our upfront presentation in June. These included a new self-serve buying platform for advertisers looking to reach local audiences, strategic sales partnerships with TikTok's premium advertising product, False Premiere, as well as Thought Dash Meredith, the largest digital and print publisher in the US, and expanded distribution for our 10 new fast channels, which we launched in April.

Speaker Change: Turning now to media.

Speaker Change: Bell media continues to transform from a traditional broadcaster to a digital media and content leader at a Prime example of that is the advanced advertising solutions for clients powered by Bell first party data, including Bell analytics, the Sam television sales tool Bell DSP addressable TV and.

Speaker Change: Crave with ads, which together, which collectively drove a 35% increase in digital advertising revenues this quarter.

Speaker Change: And investments to sustain the strategic shift to digital will continue we announced a number of new partnerships and additions to our AD offerings at our upfront presentation. In June. These included our new self serve buying platform for advertisers looking to reach local audiences strategic sales partnerships with Tic Toc premium.

Unknown Executive: We announced a number of new partnerships and additions to our ad offerings at our upfront presentation in June. These included a new self-serve buying platform for advertisers looking to reach local audiences. Our momentum also continues to build in the business enterprise space, as our expanding capabilities in cloudification, security, and managed automation have led to increasing customer wins and the expansion of existing relationships, all of which drove strong business solution services revenue growth of 22% this quarter. Building on this growth strategy, we recently acquired leading technical services companies Stratagem and Cloud Kettle.

Speaker Change: Rising product pulse premier as well as thoughts dash Meredith the largest digital and print publisher in the U S and expanded distribution for our 10, new fast channels, which we launched in April.

Mirko Bibic: Our momentum also continues to build in the business enterprise space as our expanding capabilities and cloudification, security, and managed automation have led to increasing customer wins and the expansion of existing relationships, all of which drove strong business solutions services revenue growth of 22% this quarter. Building on this growth strategy, we recently acquired leading technical services companies that strategy and cloud kettle. These acquisitions complement our acquisition of effects innovation last year by immediately strengthening Bell cyber security and sales force workflow automation know how for enterprises and enriching the range of capabilities available to manage customers' public and hybrid cloud environments with the world leading cloud providers.

Speaker Change: Our momentum also continues to build in the business enterprise space as our expanding capabilities and clarification security and managed automation have led to increasing customer wins and the expansion of existing relationships all of which drove strong business solution services revenue growth of 22% this quarter.

Speaker Change: Building on this growth strategy, we recently acquired leading technical services companies Stratagem and cloud Kettle. These.

Speaker Change: These acquisitions complement our acquisition of FX innovation last year by immediately strengthening bell cyber security and Salesforce workflow automation Knowhow for enterprises, and enriching the range of capabilities available to manage customers public and hybrid cloud environments with the world's leading cloud providers.

Mirko Bibic: We can now deliver customer solutions across the two leading platform software companies, ServiceNow and Salesforce, in addition to our new advanced managed security solution, and regarding ServiceNow. We recently entered into an expanded partnership with them to accelerate Bell's digital transformation and, importantly, the digital transformation of our enterprise customers. ServiceNow's applications will streamline several areas of our business, including network, customer, and field service operations, resulting in a more efficient experience for technicians leveraging AI-driven insights to automate scheduling, improved customer service, and reduced drive time. Also to enhance customer support with powerful automation capabilities to streamline case handling and drive faster service deliveries using solutions that ensure customers get the services they want and require in a matter of hours.

Speaker Change: We can now deliver customer solutions across the two leading platform software companies service now at Salesforce. In addition to our new advanced managed security solution and.

Unknown Executive: And regarding ServiceNow, ServiceNow's applications will streamline several areas of our business, including network, customer, and field service operations, resulting in a more efficient experience for technicians leveraging AI-driven insights to automate scheduling, improve customer service, and reduce drive time. It will also enhance customer support with powerful automation capabilities to streamline case handling and drive faster service delivery using solutions that ensure customers get the services they want and require in a matter of hours or days.

Speaker Change: And regarding service now.

Speaker Change: And we recently entered into an expanded partnership with them to accelerate Bell digital transformation and importantly, the digital transformation of our enterprise customers service now as applications will streamline several areas of our business, including network customer and field service operations, resulting in a more efficient.

Speaker Change: <unk> experienced for technicians, leveraging AI driven insights to automate scheduling improved customer service and reduce drive time also to enhance customer support with powerful automation capabilities to streamline case handling and drive faster service deliveries using solutions that ensure customers get the services they want and require.

Speaker Change: Is it a matter of hours or days.

Mirko Bibic: Dave. While these investments in partnerships and technology and automation will enable us to unlock even greater operation efficiencies going forward, we're already benefiting from advanced AI and machine learning capabilities to improve the Bell customer experience and, importantly, take costs out of our business, which contributed to $20 million in labor cost savings across our customer operations this quarter. Here are some examples of how our AI leadership is setting us apart. We pioneered a self-service virtual repair tool for technical troubleshooting of Internet and TV issues, and that eliminated call wait times and technician visits. We launched the first Google AI-powered infobot in Canada, offering instant answers to customer questions and directing them to self-serve options and links.

Speaker Change: While these investments and partnerships in technology and automation will enable us to unlock even greater operational efficiencies going forward, we're already benefiting from advanced AI and machine learning capabilities to improve the bell customer experience and importantly take costs out of our business, which contributed to 20.

Speaker Change: And the labor cost savings across our customer operations. This quarter, here's some examples of how our AI leadership is setting us apart.

Unknown Executive: We pioneered a self-serve virtual repair tool for technical troubleshooting of internet and TV issues that eliminated call wait times and technician visits. We launched the first Google AI-powered Infobot in Canada, offering instant answers to customer questions and directing them to self-serve options and links. The virtual assistant we've implemented, first for Lucky Mobile Chat and now for our Bell & Burton brand, has resulted in over 1.1 million virtual assistant interactions year-to-date across the three brands.

We pioneered a self serve virtual repair tool for technical troubleshooting of Internet and TV issues and that eliminated call wait times and technician visits we launched the first Google AI powered info bought in Canada, offering instant answers to customer questions and directing them to self serve options and links.

Mirko Bibic: Our implementation of the full Google Call Center AI platform is a world first for a contact center of this scale. The virtual assistant we've implemented first for Lucky Mobile Chat, and now for our Bell and Virgin brand, has resulted in over 1.1 million virtual assistant interactions here to date across the three brands. We've also implemented AI-powered agent support models that leverage real-time transcription. We analyze calls in our contact centers through our speech AI solution, and that enables us to identify cross cell opportunities where appropriate. We also use AI-enabled dynamic call routing to pair incoming customer calls with the agent who has the right skill set to optimize that customer experience.

Speaker Change: Our implementation of the full Google Call Center AI platform is a world first for a contact center of this scale.

Speaker Change: The virtual assistant we've implemented first for Lucky mobile chat and now for our Berlin Virgin brands has resulted in over $1 1 million virtual assistant interactions year to date across the three brands.

Unknown Executive: We've also implemented AI-powered agent support models that leverage real-time transcription. We analyze calls in our contact centers through our Speech AI solution, and that enables us to identify cross-sell opportunities where appropriate. And we're also using generative AI for call quality assurance, monitoring aspects like time on hold and manager escalations, and to automatically generate retention offers in real time. All of which is designed to vastly improve the customer experience, drive operating efficiencies, lower churn, and generate higher customer lifetime value. All remaining 107 of the Source stores are now closed, and they're no longer in operation.

Speaker Change: We have also implemented AI powered agent support models that leverage real time transcription, we analyzed calls in our contact centers through our speech AI solution and that enables us to identify cross sell opportunities where appropriate.

Speaker Change: We also use AI enabled dynamic call routing to pair in customer.

Speaker Change: Coming customer calls with the agent who has the right skill set to optimize that customers experience and we're also using generative AI for call quality assurance monitoring aspects like time on hold and manager Escalations and to automatically generate retention offers in real time.

Mirko Bibic: And we're also using generative AI for call quality assurance, monitoring aspects like time on hold and manager escalations, and to automatically generate retention offers in real time, all of which is designed to vastly improve the customer experience, drive operating efficiencies, lower-churn, and generate higher customer lifetime value.

Speaker Change: All of which is designed to vastly improve the customer experience drive operating efficiencies lower churn and generate higher customer lifetime value.

Mirko Bibic: And against the backdrop of these accelerating investments in key growth areas, we entered into a transaction to sell Northwest Tell to a consortium of indigenous communities for up to $1 billion in cash. This was a unique opportunity that emerged to surface good value for a standalone BCE asset at a fair valuation, and to use those proceeds to proactively manage our balance sheet and to pay down debt. And consistent with our strategy to reduce focus on non-core businesses, we took the next step in the transition of 167 the source stores to Best Buy Express with the opening of our first store in June.

Speaker Change: And against the backdrop of these accelerating investments in key growth areas, we entered into a transaction to sell northwest tell to a consortium of indigenous communities for up to $1 billion in cash.

Speaker Change: This was a unique opportunity that emerged to surface good value for a standalone BCE asset at a fair valuation and to use those proceeds to proactively manage our balance sheet and to pay down debt.

Speaker Change: And consistent with our strategy to reduce focus on noncore businesses. We took the next step in the transition of 167, the sore stores to best buy expressed with the opening of our first store in June.

Mirko Bibic: That marks the beginning of a phase rule out, with all stores expected to be opened by the end of this year. All remaining 107 the source stores are now closed and they're no longer in operation.

Speaker Change: That marks the beginning of a phased rollout with all stores expected to be opened by the end of this year.

Speaker Change: All remaining 107, the sore stores are now closed and there are no longer in operation.

Mirko Bibic: I'm going to turn now to slide five for a brief review of some of the operating metrics by segment, and I'll start with wireless, of course. We added 131,043 new net mobile phone subscribers in Q2. That's up 4.4% from last year, and that was a function of a 14.4% increase in gross activations, which outpaced peers who have already reported by a wide margin and a second consecutive quarter of deceleration in the year-over-year rate of turn. Now, the churn does remain elevated, and it's clearly not at a level that I'm satisfied with, but it's now sequentially from Q1, both in absolute terms and in the magnitude of increase when compared to the prior year.

Speaker Change: Im going to turn now to slide five for a brief review of some of the operating metrics by segment and I'll start with wireless of course.

Unknown Executive: We added 131,043 new NetMobile phone subscribers in Q2, that's up 4.4% from last year, and that was a function of a 14.4% increase in gross activations, which outpaced peers who have already reported by a wide margin and a second consecutive quarter of deceleration in the year-over-year rate of churning. Although post-paid net ads of $78,500 were down versus Q2 of last year on what was a relatively strong prior year, importantly, and quite deliberately, the vast majority of our new customers continue to be on our main premium brand, which is fundamental to our operating strategy.

Speaker Change: We added 131043, new net mobile phone subscribers in Q2, that's up four 4% from last year and that was a function of a 14, 4% increase in gross activations, which outpaced peers, who have already reported by a wide margin and our second consecutive quarter of deceleration.

The year over year rate of churn increase.

Speaker Change: Now the churn does remain elevated and it's clearly not at a level that I'm satisfied with but it's down sequentially from Q1, both in absolute terms and then the magnitude of increase when compared to the prior year.

Mirko Bibic: Although post paid net ads of 70,500 were down versus Q2 of last year on what was a relatively strong prior year; importantly, and quite deliberately, the vast majority of our new customers continue to be in our main premium brand. This result reflects our focus on better quality, profitable and margin of creative subscriber acquisition. We plan to continue with this consistent and disciplined approach, which balances subscriber growth with financial performance rather than just buying loads as we progress through the balance of 2024 and beyond. Prepaid net additions were up meaningfully over last year, growing to 52,543 as we benefited from the launch of Known a Mobile and Lucky Mobile marketing initiatives.

Speaker Change: Although postpaid net adds of 78500 were down versus Q2 of last year on what was a relatively strong prior year importantly, and quite deliberately the vast majority of our new customers continue to be on our main premium brand, which is fundamental to our operating strategy.

Speaker Change: This result reflects our focus on better quality profitable and margin accretive subscriber acquisition.

Unknown Executive: We plan to continue with this consistent and disciplined approach, which balances subscriber growth with financial performance rather than just buying lows, as we progress through the balance of 2024 and beyond. We had 23,841 new retail internet customers. Driving this performance was Crave, which grew direct streaming subscribers by 21% in Q2 on the back of market-leading content, as well as strong growth in usage of our programmatic ad marketplace, including our Sam TV advertising tool, which increased sales revenue by 43% this week.

Speaker Change: We plan to continue with this consistent and disciplined approach, which balance of subscriber growth with financial performance rather than just buying loads as we progress through the balance of 2024 and beyond.

Speaker Change: Prepaid net additions were up meaningfully over last year growing to 52543 as we benefited from the launch of <unk> mobile and Lucky mobile marketing initiatives. This represents our best quarterly prepaid result in almost two years.

Mirko Bibic: This represents our best quarterly prepaid result in almost two years. Having led the market and prepaid growth this quarter, it shows that we've made the massive strides and breaking into the Canadian new market, newcomer market in a relatively short period of time. To close off on wireless, our poo was down 1.9% year over year. This result doesn't come as a surprise given that we've been facing the lowest pricing environment in the history of wireless in Canada for much of the past year. However, we did see an improvement in June, and although encouraging, given the current dynamic pricing environment that's in flux as we enter the back to school period, it is still too early to make a call on the direction of our poo for the balance of this year.

Speaker Change: Having led the market in prepaid growth this quarter. It shows that we've made the massive strides in breaking into the Canadian new Mark newcomer market in a relatively short period of time.

Speaker Change: To close off on wireless ARPA was down one 9% year over year.

Speaker Change: This result doesn't come as a surprise given that we've been facing the lowest pricing environment in the history of wireless in Canada for much of the past year. However, we did see an improvement in June and although encouraging given the current dynamic pricing environment. That's in flux as we enter the back to school period, it's still too early to make a call on the direction of <unk> for the balance of.

Speaker Change: This year.

Speaker Change: I'm going to turn it over to wireline now.

Mirko Bibic: I'm going to turn over to wireline now. We had 23,841 new retail Internet, Internet additions.

Speaker Change: We had 23841, new retail internet Internet additions.

Mirko Bibic: We delivered our second best Q2 results since 2007 after Q2 2023, which was an exceptional year. Moreover, where we have fiber, our bundle sales continue to grow. In Q2 alone, new customers subscribing to mobility and internet service bundles increased 23% compared to last year. We now comprise 48% of our total residential households, and we had another solid quarter for our Bell branded IPTV service, which added 3% more new net subscribers than Q2 2023.

Speaker Change: We delivered our second best Q2 results since 2007, after Q2, 2023, which was an exceptional year.

Speaker Change: Moreover, where we have fiber or bundled sales continue to grow in Q2 alone new customers subscribing to mobility and Internet service bundles increased 23% compared to last year and now comprise 48% of our total residential households, and.

Speaker Change: And we had another solid quarter for our for our Bell branded IP TV service, which added 3% more new net subscribers in Q2 2023.

Mirko Bibic: However, gross activations on our five TV at the streaming service were down considerably this quarter, and that was due to a $5 rate increase in May for new subscribers, and it resulted in a 12,800 year-over-year decrease in total IPTV net additions.

Speaker Change: However, gross activations on our five TV App streaming service were down considerably this quarter and that was due to a $5 rate increase in may for new subscribers and it resulted in a 12800 year over year decrease in total IP TV net additions.

Speaker Change: Lastly, I'm going to turn it over to media.

Mirko Bibic: Lastly, I'm going to turn over to media. Total advertising revenue was up on the strength of digital and live sports, and although this result represents our second consecutive quarter of growth, the ad market improvement is expected to be uneven for the balance of this year. Digital and direct consumer continue to grow strongly, helping to offset the secular pressures from traditional media platforms. Digital revenues were up 23% over last year, and they now comprise 41% of media revenue compared to 33% last year.

Speaker Change: Total advertising revenue was up on the strength of digital and live sports and although this result represents our second consecutive quarter of growth.

Speaker Change: AD market improvement is expected to be uneven for the balance of this year.

Speaker Change: Digital and direct to consumer continued to grow strongly helping to offset the secular pressures from traditional media platforms digital revenues were up 23% over last year and they now comprise 41% of media revenue compared to 33% last year.

Mirko Bibic: Carter. Driving this performance was crave, which grew direct streaming subscribers by 21% in Q2 on the back of market-leading content, as well as strong growth and usage of our programmatic ad marketplace, including our Sam TV advertising tool, which increased sales revenue by 43% this quarter. TSN and RDS directed consumer streaming subscribers more than doubled over last year, and that was on the back of Euro Cup soccer and record-breaking audiences.

Speaker Change: Driving this performance was crave, which grew direct streaming subscribers by 21% in Q2 on the back of market, leading content as well as strong growth in usage of our programmatic AD marketplace, including our <unk> TV advertising tool, which increased sales revenue by 43% this quarter.

Speaker Change: <unk> and Rds direct to consumer streaming subscribers more than doubled over last year and that was on the back of Euro Cup soccer and record breaking audiences for the Copa America.

Mirko Bibic: This is for the Co-op of America tournament. For the current broadcast season today, CTV remains Canada's most watch network for 23rd consecutive year. On the French language side, Belmedia led all competitors in the entertainment and pay specialty market, and New Vote was the conventional TV market network, excuse me, with the largest growth in full day audiences, increasing 8% over Q2 last year. In summary, our performance for Q2 reflects the team's consistent execution in a highly competitive and evolving marketplace, with financial results that demonstrated improved and balancing of subscriber growth with profitability, and a continued sharp focus on cost efficiency and effectiveness.

Speaker Change: For the current broadcast season to date CTV remains Canada's most watched network for 23rd consecutive year.

Unknown Executive: In summary, our performance for Q2 reflects the team's consistent execution in a highly competitive and evolving marketplace, with financial results that demonstrated a prudent balancing of subscriber growth with profitability and a continued sharp focus on cost efficiency and effectiveness.

Curtis Millen: I'll now turn the call over to Curtis, who's going to provide more details on our financial results. Thanks, Marco. Good morning, everyone. As you can see on slide 7, our consolidated financial results for Q2 demonstrate Belmedia's consistent and responsible execution in an intensely competitive marketplace. We return to positive service revenue growth in Q2, following the calls in the two previous quarters. This is the direct result of our successful fiber strategy, our ability to attract premium wireless subscribers, and drive greater cross-step penetration of ability and internet households, our expanded business tech services capabilities, and continued strong digital media growth.

Unknown Executive: Thanks, Marco, and good morning, everyone. As you can see on slide 7, our consolidated financial results for Q2 demonstrate the Bell team's consistent and responsible execution in an intensely competitive market. We return to positive service revenue growth in Q2 following declines in the two previous quarters. This is the direct result of our successful fiber strategy, our ability to attract premium wireless subscribers and drive greater cross-out penetration of mobility and the Internet.

Speaker Change: Penetration of mobility, and internet households, or expanded business tax services capabilities and continued strong digital media growth.

Curtis Millen: Total revenue was down 1%; this can be attributed to an 8.7% decrease in low margin wireless and waterline product sales, which included the loss of revenue from the source store closures. Adjust the EBITDAG road 2%, delivering a notable margin improvement of 1.3 points on the back of a 3.3% reduction in operating costs. Net earnings were up 52% in Q2. While health pipe can become, the increase was due mainly to a large non-cash loss recorded in Q2 of 2023, when BC share an obligation to repurchase the minority interest and enjoy investor equity investment at share value.

Speaker Change: Total revenue was down 1%. This can be attributed to an $8, 7% decrease in low margin wireless and wireline product sales, which included the loss of revenue from the source store closures.

Unknown Executive: Total revenue is down 1%. This can be attributed to an 8.7% decrease in low-margin wireless and wireline products, which included the loss of revenue from the source store closures. Adjusted EBITDA row 2% Net earnings were up 52% in Q2. While helped by EBITDA, the increase was due mainly to a large non-cash loss recorded in Q2 of 2023 when BC's share of an obligation repurchased the minority interest in a joint venture equity investment at share value.

Speaker Change: Adjusted EBITDA grew 2% delivery.

Speaker Change: Delivering a notable margin improvement of $1 three points on the back of a $3, 3% reduction in operating costs.

Speaker Change: Net earnings were up 52% in Q2, while helped by EBITDA increase was due mainly to a large noncash loss recorded in Q2 of 2023, when do you see share of an obligation to repurchase the minority interest in a joint venture equity investments at fair value.

Curtis Millen: Nothing notable on adjusted EPS, consistent with our 2024 guidance assumptions for interest and appreciation expense. It was down 1% compared to last year. As for free cash flow, it grew a strong 8% this quarter, benefiting from the flow through of higher EBITDAG and lower CAPEX. In line with our plan to reduce capital spending by at least $500 million in 2024, CAPEX was down $329 million in Q2. This brought year-to-date CAPEX savings to 413 million, so well on track to achieve our plan reduction for the year.

Speaker Change: Nothing notable on adjusted EPS, consistent with our 2024 guidance assumptions for interest and depreciation expense it was down <unk> <unk> compared to last year.

Speaker Change: As for free cash flow grew a strong 8% this quarter.

Unknown Executive: As for free cash flow, it grew a strong 8% this quarter, benefiting from the flow-through of higher EBITDA and lower capital. Turning to Bell CTF's financial results on slide 8. The top line story here is all about low-margin product revenue, which was down $66 million in Q2. The source store closures that are referenced earlier and reduced wireline telecom equipment sales as levels normalized following an exceptional year in 2023 due to the global supply chain recovery.

Speaker Change: <unk> from the flow through of higher EBITDA and lower Capex.

Curtis Millen: Turning to Bell CCS financial results on slide 8. Topline story here is all about low margin product revenue, which was down $66 million in Q2, accounting for 93% of the 1.3% decline in total revenue. The decrease was the result of lower mobile phone sales; at 70% of new customer activations in Q2 were BIOD stocks.

Curtis Millen: The source store closures that are referenced earlier, and reduced waterline telecom equipment sales as levels normalized following an exceptionally year in 2023 due to the global supply chain recovery. Importantly, the EBITDA impact was negligible, as these product revenues are very low margin. Internet revenue was not approximately 3%, while wireless service revenue grew by 1.2%. Although both are solid results, they continue to be impacted by overly aggressive rate time pricing and bundle discounting, reflecting a more intense competitive market environment compared to last year.

Unknown Executive: Importantly, the EBITDA impact was negligible as these product revenues are very low-margin. All wireless service revenue grew by 1.2%. However, although both are solid results, they continue to be impacted by overly aggressive rate plan pricing and bundle discounts.

Unknown Executive: Reflecting a more intense competitive market environment compared to last year, we also continue to see good business solutions strikes, a key growth factor going forward, where revenue grew 22% over last year. However, the financial highlight of the quarter was EBITDA, which strengthened over Q1, growing by 2% to yield a strong margin of 46.9%. That's a 150 point increase over last year and the direct result of our focus on cost management, as evidenced by a 4.1% reduction in Q2 operating costs and margin of credit of subscribers, which is a testament to the team's strong execution, our diversified asset mix, premium content, and the success of our digital-first media strategy.

Curtis Millen: This, together with ongoing legacy erosion, moderated service revenue growth this quarter. We also continue to see good business solutions rise, a key growth factor going forward, where revenue grew 22% over last year. This was driven by higher sales of cloud-based computing, managed automation and security services, as well as our acquisition of AFTX innovation that we laughed in June.

Speaker Change: And we lapped in June.

Curtis Millen: However, the financial highlight of the quarter was EBITDA, which strengthened over Q1, growing by 2% to yield a strong margin of 46.9%. That's a 150 point increase over last year, and the direct result of our focus on cost management, as evidenced by a 4.1% reduction in Q2 operating costs and margin and credo subscriber growth.

Speaker Change: However, the financial highlight of the quarter was EBITDA, which strengthened over Q1 growing by 2% to yield a strong margin of $46, 9% at 150 point increase over last year and a direct result of our focus on cost management as evidenced by a $4, 1% reduction in Q2 op.

Speaker Change: <unk> cost and margin accretive subscriber growth.

Curtis Millen: Turning over to Belmedia on slide 9, good overall financial performance in Q2.

Speaker Change: Turn it over to Bell media on slide nine.

Speaker Change: Good overall financial performance in Q2.

Curtis Millen: In fact, this marks Belmedia's first quarter of revenue and EBITDA growth in 2 years, a positive result on the circumstances, which is a testament to the team's strong execution, our diversified asset mix, premium content, and success of our digital first media strategy. Total Q2 revenue was up approximately 1%. This result was driven by a 1.9% increase in advertising revenue, on the back of our strong TV sports specialty performance, continued robust digital advertising growth, and the acquisition of AFTX Media that was completed in June. The F1 Canadian grow up free and higher international sales of Belmedia programming also contributed to higher revenue this quarter.

Speaker Change: In fact, this marks bell Media's first quarter of revenue and EBITDA growth in two years.

Speaker Change: Positive result, under the circumstances, which is a testament to the team's strong execution, our diversified asset mix premium content and success of our digital first media strategy.

Speaker Change: Total Q2 revenue was up approximately 1%.

Unknown Executive: Total Q2 revenue was up approximately 1%. The F1 Canadian Grand Prix and higher international sales of Bell Media Programming also contributed to higher revenue this year. This is a recurring theme, which increased only marginally despite higher TV programming. As much of this pressure was effectively offset by cost savings. This, together with the benefit of higher revenue, enabled us to deliver EBITDA growth of nearly 2% this quarter. Turning to the balance sheet on slide 10, we ended Q2 with $5 billion of available liquidity, which includes the proceeds of a $1.5 billion public debt issuance we completed in May.

Speaker Change: This result was driven by one 9% increase in advertising revenue on the back of our strong TV sports specialty performance continued robust digital advertising growth and the acquisition of <unk> media that was completed in June.

Curtis Millen: The media team also did a great job managing costs, which is a recurring theme, which increased only marginally despite higher TV program costs, as much of this pressure was effectively offset by cost saving issues. This, together with the benefit of higher revenue, enabled us to deliver EBITDA growth of nearly 2% this quarter.

Curtis Millen: Starting to balance sheet on slide 10, we ended Q2 with 5 billion of available liquidity, which includes the proceeds of a 1.5 billion dollar public debt issuance we completed in May.

Curtis Millen: Our debt majority schedule was also pretty much structured with an average terms of maturity of approximately 13 years, and an AFTX cost of debt below prevailing interest rates at 3.2%.

Unknown Executive: Our debt maturity schedule is also crudely structured with an average term to maturity of approximately 13 years. This led to a slight increase in our leverage ratio from Q1 to 3.7 times adjusted EBITDA. We can see from our performance in the first half of 2024 that we are effectively navigating a dynamic, competitive, and economic environment to achieve financial results largely in line with our expectations. Going forward, we'll continue to execute in the same consistent and disciplined manner, focusing on cost efficiencies and balanced growth.

Curtis Millen: This, together with those standing refinancing requirements for the balance of the year, maturity is in 2025, totaling $201 billion that have already been largely pre-funded. Using interest rates and a sizable pension solvency surplus, we remain in a good financial position. We made a final payment of $414 million in Q2 for $3,800 million. Expect to know we won an auction late last year. This led to a slight increase in our leverage ratio from Q1 to 3.7 times adjusted EBITDA. We're mindful of our elevated debt position, and we remain highly focused on reducing our leverage ratio over time.

Curtis Millen: This will be achieved through positive free cash flow generation, after dividend payments, and using the proceeds from asset sales, such as Northwest Health, to pay down debt. In fact, the announced billion dollar Northwest Health transaction is expected to improve our leverage ratio by out to approximately five basis points.

Curtis Millen: To finish off on slide 11, you can see from our performance in the first half of 2024 that we're effectively navigating a dynamic competitive and economic environment to achieve financial results largely in line with our expectations. The only forward will continue to execute the same consistent and disciplined manner, focusing on cost efficiencies and balance growth. Accordingly, we're made confident in our ability to deliver on all of our financial guidance targets for 2024.

Speaker Change: To finish off on slide 11, you can see from our performance in the first half of 2024.

Speaker Change: We are effectively navigating a dynamic competitive and economic environment to achieve financial results largely in line with our expectations.

Speaker Change: Going forward, we will continue to execute the same consistent and disciplined manner.

Speaker Change: Focusing on cost efficiencies and balanced growth.

Speaker Change: Accordingly, we remain confident in our ability to deliver on all of our financial guidance targets for 2024.

Thane Fotopoulos: We'll now hand the call back to Fane and the operator to begin tonight. Thanks, Curtis. So before we start to keep the calls efficient as possible, please win with yourselves to one question and every follow-up at PMAS, so that we can get to as many questions in the Q as possible with the time we have left.

Fame: I'll now hand, the call back to Fame and the operator to begin Q&A. Thanks, Curtis So before we start to keep the call as efficient as possible. Please limit yourself to one question and a brief follow up a few months. So that we can get to as many questions in the queue as possible at the time, we have left.

Operator: If that Matthew, we're ready to take our first question.

Fame: With that Matthew we're ready to take our first question.

Operator: Thank you. The first question is from Maher Yaghi from Scotiabank. Please go ahead.

Operator: Thank you.

Matthew: Thank you.

Stephanie Price: The first question is from Mayor Diaghi from Scotia Bank. Please go ahead. Great. Thank you for taking my question. Good morning, everyone. So I wanted to ask you. I won't ask you about wireless. I'll ask you about wireline, actually. So we are seeing significant promotional and retention activities in the market with, you know, some like lifetime price locks guarantees by Videotron, which is, you know, the Canadian market hasn't seen before, but also aggressive signing promotions by Bell with prices as low as $55 for 1.5 gigs. You know, we are waiting for the decision by the CRTC, but I would say the market is quite competitive, but that's just me.

Speaker Change: First question is from <unk> <unk> from Scotiabank. Please go ahead.

<unk> <unk>: Okay, great. Thank you for taking my question. Good morning, everyone. So I wanted to ask you I won't ask you about the wireless I'll ask you about wireline actually.

Mirko Bibic: We'll see what they have in mind, but my question on this topic is the following. When, first, you know, when BC first embarked on its fiber to the home deployment, I remember quite clearly, you know, quite 10 years ago, the expectation was that broadband, our pool was going to be in the 90 to $100 range, and now we're sitting at $55, $60 range. Are we still seeing positive NPVs on fiber to the home when you look at your models and you look at the pricing currently in the marketplace. What's your view on that investment and its potential positive return for shareholders?

Maher Yaghi: When BCE first embarked on its fiber-to-the-home deployment, I remember quite clearly, you know, quite like 10 years ago, the expectation was that broadband ARPU was going to be in the $90 to $100 range, and now we're sitting at $55, $60 range. Are we still? Seeing positive NPVs on fiber to the home when you look at your models and you look at the pricing currently in the marketplace, potential positive returns for shareholders. Thank you.

Mirko Bibic: Thank you.

Mirko Bibic: Thank you, Mayor. That's for the question. The fiber continues to be the growth engine of Bell on the wireline side. Frankly, if you look at the communication segments pretty much everywhere, the area of growth in wireline is actually fiber, so still quite positive on the fiber strategy. Obviously, it remains the bedrock of our Wireline strategy, and the investments were much needed, critical, and will serve us well for years and years to come. I'm quite pleased with our Internet performance over time, but including Q2 of this year was our second best Q2 since 2007, after last year, which was a standout quarter a year ago.

Unknown Executive: Thank you, Mayor. That's for the question. Look, fiber continues to be the growth engine of As you see, we're going to adjust to circumstances as they arise, whether it's the pricing environment, macroeconomic pressures, or regulatory pressures. We're just going to adjust, and you've seen a major adjustment over the last 12 months in terms of the pace of our fiber build as we get closer and closer to reaching our near-term build-out targets, and we'll continue to adjust very quickly in the face of pressures, and that's one of the hallmarks of how Bell operates. Thank you.

Mirko Bibic: So, I already said that in my opening remarks. We're seeing very good, very good bundling success, and that's adding to the lifetime value of customers, Mayor. Now, there is room for our coup growth in some markets, though. We've seen promotional intensities stabilized as bill credits lower. You're giving an example of a particular offer that that's maybe a market in particular areas, but they're really catering to higher value customers, which remains part of our overall strategy. We're in an intense pricing environment in wireline. Everybody knows this, but we're going to continue to focus on generating lifetime value for customers who choose the very best and who want premium product, and that's Bell 5. We're doing a very good job standing out in the marketplace.

Speaker Change: So there is room for <unk> growth.

Speaker Change: In some markets, though I site, we've seen promotional intensity stabilize as bill credits lowered year, giving an example.

Speaker Change: Of a particular offer that.

Speaker Change: <unk> may be in market in particular areas, but they are really catered to higher value customers, which remains part of our overall strategy.

Speaker Change: We are in an intense pricing environment in wireless and wireline everybody knows this but we're going to continue to focus on generating.

Speaker Change: Lifetime value for customers, who choose the very best and who want premium product in that spell five.

Speaker Change: And we're doing a very good job standing out in the marketplace I would say go to end to end.

Mirko Bibic: I would say that to end the answer to your question. As you see, we're going to adjust to circumstances as they arise, whether it's pricing environment, macroeconomic pressures, regulatory pressures; we're just going to adjust. And you've seen a major adjustment over the last 12 months in terms of the pace of our fiber build as we get closer and closer to reaching our near-term build-out targets.

Speaker Change: And the answer to your question.

Speaker Change: As you see where we're going to adjust to circumstances as they arise.

Speaker Change: Whether it's pricing environments macroeconomic pressures.

Mirko Bibic: And we'll continue to adjust very quickly in the face of pressures, and that's going to be the hallmarks of how Bell operates.

Mirko Bibic: Thank you.

Stephanie Doris Price: Thank you. Our next question is from Stephanie Price from CIBC World Markets. Please go ahead.

Stephanie Price: Our next question is from Stephanie Price from CIBC World Markets. Please go ahead. Good morning. I was hoping to understand more around the opportunities with ServiceNow and AI and automation. Are these initiatives kind of included in your original cost savings initiatives, or should we think about them as additive? And it's so how do we think about the magnitude and timing around automation and automation?

Mirko Bibic: Thanks for the question. So on ServiceNow, we are kind of embedding ServiceNow into our own environment in order to increase efficiency, both in how we operate, of course, driving costs out of the business. But I'm particularly, I'm particularly energized in terms of that partnership with our ability to go to market with some of the in conjunction with ServiceNow and to serve our enterprise customers and their own digital transformation journeys and that's across cloud security and managed automation and integrating ServiceNow into the environments of our customers and. And co-creating with ServiceNow so that we can jointly go to market. So that's where for me is equally positive initiative is on the go to market side, including kind of embedding it into our own environment. So that's going to continue to drive costs out of our business combined with more robotic process automation and more use of AI, Stephanie.

Unknown Executive: Thanks for the questions. So on, and we are co-creating with ServiceNow so that we can jointly go to market. So that's where, for me, it's an equally positive initiative on the go-to-market side, including kind of embedding it into our own environment. So that's going to continue to drive costs out of our business, combined with more robotic process automation and more use of AI, Stephanie. I gave a list of examples in my opening remarks of how we're going to use AI to improve the customer experience, attract more customers, and, importantly, drive costs out of the business.

Mirko Bibic: I gave a list of examples in my opening remarks of how we're going to use AI to improve the customer experience, attract more customers and, importantly, drive costs out of the business, and I share the 20 million figures, so I can't give you a. A precise figure as to how we're going to continue, or the quantum of cost efficiencies quarter by quarter that are going to come from deploying AI and ServiceNow, but we're going to continue to do that in the business and you can count on us to do it. And definitely the only thing I'll add to see the second part of your question, you know, we've been looking at those types of opportunities for years, and we do see the results.

Unknown Executive: And I shared the 20 million figures. So I can't give you a precise figure as to how we're going to continue or the quantum of cost efficiencies quarter by quarter that are going to come from deploying AI and service now, but we're going to continue. Stephanie, the only thing I'll add is just the.

Mirko Bibic: These are part of them, but to answer the other part of your question, we would look at this is incremental to the workforce for structuring benefits that we talked about in February. And just on that, we do remain on track in terms of any of those targets. We continue to see a way through to 150 to 200 million dollars of in your savings, as we appreciate it's a pretty big workforce for structuring, so it will continue to scale throughout the year, but we see those as two different opportunities.

Speaker Change: We always have.

Speaker Change: In your savings.

Speaker Change: As you can appreciate it's a pretty big workforce restructuring so it.

Speaker Change: We'll continue to scale throughout the year, but we see those as two different opportunities.

Stephanie Price: Great. Thank you very much. Thank you.

Speaker Change: Great. Thank you very much.

Speaker Change: Thank you. Our next question is from Sebastiano Petti from J P. J P. Morgan. Please go ahead.

Sebastiano Petti: Our next question is from Sebastiano Petti from JP Morgan. We go ahead. Thank you. Just a quick follow-up there, Curtis, on the 150 to 200 million of cost savings.

Speaker Change: Sure.

Sebastiano Petti: Thank you and just a quick follow up there Curtis on the $150 million to $200 million of cost savings can you maybe tell us where we're at in terms of the run rate exiting the second quarter and I think you know how should we anticipate that perhaps tracking and phasing over the balance of the year would be helpful. And then I think we talked about.

Unknown Executive: Thank you. Just a quick follow-up there, Curtis. On the $150 to $200 million of cost savings, can you maybe tell us where we are in terms of the run rate exiting the second quarter? And I think, you know, how should we anticipate that perhaps tracking and phasing over the balance of the year would be helpful. And then I think we talked about

Curtis Millen: Can you maybe tell us where we're at in terms of, you know, the run rate exiting the second quarter? And I think, you know, how should we anticipate that perhaps tracking and phasing over the balance of the year would be helpful. And then I think we talked about to Merco, I guess, or you know to Curtis as well in terms of just thinking about, you know, prepaid and the new to Canada market, you know, strong results there. Part of that obviously driven by, you know, the no name mobile lucky initiatives you talked about, but this has been building for some time.

Speaker Change: To Merck or I guess, where you know to Curtis as well in terms of just thinking about you know prepaid in the new to Canada market, Yes strong results. There part of that obviously driven by you know the know named mobile Lucky initiatives you talked about.

Speaker Change: But this has been building for some time can you help us think about you know.

Mirko Bibic: Can you help us think about, you know, how your how the team is evaluating maybe the prepaid verse post paid mix, given the emphasis and the focus on premium loadings on the Bell brand. Should we should we think about above and beyond perhaps some of your initiatives with no name mobile lucky. And the new to Canada market continue to be robust. Should we think about maybe a higher mix towards the prepaid loadings over the, you know, over the common quarters and, you know, maybe over the next year or the foreseeable future rather as a way to perhaps combat, you know, like brand competitions or maybe your thoughts on that would be great.

Speaker Change: How your how the team is evaluating maybe the prepaid versus postpaid mix given the emphasis and the focus on premium loadings on the Bell brand should we should we think about.

Curtis Millen: Thanks.

Curtis Millen: Hi to the channel. Thanks for the question.

Unknown Executive: Hi Sebastiano, thanks for the question. I'll answer the first question you have and then hand it over to Mirko. So we're not going to report that information on a quarterly basis, but I would say, as we reiterate our confidence in capturing those savings in-year, that we expect and continue to expect to reach our run rate benefit by the end of Q4. So it'll continue to ramp up through the year, and we'll hit our in-year target, and we'll be at full run rate by the end of the calendar year.

Mirko Bibic: I'll answer the first question I had, and then handed over to Merco. So we don't, we're not going to report that information on a quarterly basis, but I would say, as we reiterate our confidence in capturing those savings in year, that we expect and continue to expect to reach our run rate benefit by the end of Q4. So continue to ramp up through the year, and we'll hit our end year target, and we'll be full run rate by end of the calendar year.

Mirko Bibic: Thank you.

Unknown Executive: Thank you. So I'm glad you asked the question about prepaid because I would like to emphasize the very strong growth you see in prepaid. Think through how we're trying to segment customers. We need to better align Base Pricing with In-Market Pricing or better aligned in-market pricing with base pricing. Number one, we need to better align the pricing differential between Bring Your Own Device and Contract Pricing, and at the same time, we need to differentiate between prepaid and value-based postpaid plans.

Mirko Bibic: So I'm glad you asked the question on prepaid because, you know, I would love, allows me to kind of emphasize that the very strong growth you see in prepaid actually is, in my mind, very well aligned with the premium loading strategy actually. So if you think through how we're trying to segment customers, we need to better align. based pricing with in market pricing, a better line in market pricing with with base pricing. Number one, we need to better align the pricing differential between bring your own device and contract pricing. And, you know, at the same time we need to differentiate between prepaid and value-based post-paid plans.

Mirko Bibic: And we did a much better job in Q2 making prepaid the true entry point for those looking to enter wireless at the lower price point, and that includes a portion of newcomers and other customers. And, and then what you do is you work on migrating your prepaid customers, those who were seeking an entry price point; you seek to migrate them up to a postpaid plan. So if you do that properly, what you're going to do is you're going to attract, you know, a bigger portion of those newcomers in Canada or those newcomers into the segment.

Unknown Executive: And we did a much better job in Q2 making prepaid the true entry point for those looking to enter wireless at a lower price point, and that includes a portion of newcomers and other customers. And then what you do is you work on migrating your prepaid customers, those who were seeking an entry price point; you seek to migrate them up to postpaid plans, and strong growth in prepaid, particularly adept at attracting newcomers to Canada.

Mirko Bibic: And to into the prepaid rather than into post paid, which was a problem on how we were pricing as an industry, let's say a year ago. And so I think what we did there is we saw, you know, as we better align that pricing and as we better segmented customers, we saw very strong growth in premium post-paid loadings and strong growth in prepaid, particularly adept at attracting newcomers to Canada. In that segment. So the success you see there is completely aligned. Premium post-paid better growth on newcomers, which is a continue a category that continues to grow.

Mirko Bibic: And that's because we did a better job at differentiating the pricing across the various brands.

Mirko Bibic: Thank you.

David Barden: Our next question is from David Barton from Bank of America. Please go ahead. Hey guys, thank you for taking the questions. Good morning. I guess my first question would be. Mercco at the, you know, at the very beginning of the year, there was a hope that that we might see decelerating our pro growth last quarter. There was a change in expectations that we would maybe see declining our food for the year. Your comments just now seem maybe to express some cautious optimism that the second half is yet to be written, could you.

Unknown Executive: Hey guys, thank you for taking the questions. Good morning, through your decisions to cut the cap back.

Mirko Bibic: Maybe map out for us, you know, the good base and bad case scenarios and how you see those unfolding in the back part of the year for Bel Canada in the, in the wires are who front. And then the follow up. You know, could you share with us any traction that you think Bel Canada has achieved through your decisions to cut catbacks, cut employment in response to some of the regulatory decisions that have been made. Do you think that that's born any fruit or may bear fruit to, you know, yet, thank you.

Speaker Change: Or may bear fruit.

Speaker Change: Yeah. Thank you.

Mirko Bibic: Thank you. Well, I'd say, and I mean, wireless, and I'm pricing, we are facing the most intense competitive pressure in the history of our industry in Canada.

Speaker Change: Thank you.

Speaker Change: I'd say.

Speaker Change: And I'm in wireless and on pricing, we are facing the most intense competitive pressure in the history of our industry, Canada I said that in my opening in my opening comments, but we wont repeat.

Mirko Bibic: I said that in my opening, in my opening comments, but we, we don't repeat the lengthy answer I gave to Sebastiano, but I'll say that, you know, I'll add to that, that we did take steps in early July to reset pricing. To what we feel is more sustainable while continuing, and this is really important while continuing to deliver exceptional value to our customers. So, too early to call what that, what that might bring for the balance of the year, but we did take those steps in early July, and it's in keeping with that kind of customer segmentation strategy that I described a few minutes ago.

Speaker Change: The lengthy answer I gave to sort of best channel, but I'll say that.

Unknown Executive: The lengthy answer I gave to Sebastiano, but I'll say that, you know, I'll add to that, that we did take steps in early July to reset prices. [inaudible] On the second part of your question, David, I know our views on the overall environment are very well known. So I won't I won't repeat them. What I will say, though, is we're going to continue to focus on our strategy, which is, I hope, crystal clear, which is to continue to capitalize on our fiber momentum. It's the product of choice for customers who continue to focus on the premium loadings in wireless.

Speaker Change: I'll add to that that we did take steps in early July to reset pricing.

Speaker Change: To what we feel is more sustainable while continuing and this is really important while continuing to deliver exceptional value to our customers. So.

Speaker Change: Too early to call what that.

Speaker Change: What that might bring for the balance of the year, but but we did take those steps in early July and it's in keeping with that.

Speaker Change: Customer segmentation strategy that I described a few minutes ago on.

Mirko Bibic: So, on the second part of your question, David, I know our views on the overall environment are very well known, so I won't repeat them. What I will say though, is we're going to continue to focus on our strategy, which is I hope is crystal clear, which has continued to capitalize on our fiber momentum. It's the product of choice for customers. Continue to focus on premium loadings in wireless, continue to focus on mobility and Internet bundles. We're going to use our advantage, our lead in AI, to continue to improve the customer experience and lower costs, and maybe a little bit more pertinent to your direct question.

David: On the second part of your question David.

Mirko Bibic: We're focused on investments in our core business and in growth segments, so whether or not that's things like the acquisition of our front, our service and our partnership, the acquisitions of strategy, the shift from the source to best buy, known in mobile. Those are those are very important investments in growth areas, and so those are the elements of the strategy.

Mirko Bibic: Thanks, Marcos.

Vince Valentini: Thank you.

Vince Valentini: Our next question is from Vince Valentini from TD Securities. Let's go ahead. I thank you very much.

Vince Valentini: Can I just clarify the 70% the YOD courtesy, would that be on total activations or just post paid and then just a follow up question on a different topic. A couple of your peers use dividend sort of grip discount programs to help alleviate the increase in their debt as they pay their dividends. I'm wondering, is that not something that BC is considered? It seems to be a very eloquent way to match the interest of equity shareholders plus quite a rating agencies and bondholders.

Curtis Millen: Now I have insight for the questions. On the first one, just a clarification: the 70% of the YOD is on post date and growth. And in terms of the different kind of grip, so you know, we certainly considered it; it's not in our plan at this point. We believe we have a path to getting our peer ratio below 100%, driving free castle through all of the levers that Marco and I have mentioned.

Unknown Executive: Ross, yeah, Paul Figueroa. And in terms of the discounted grip, so, you know, we certainly consider it. It's not in our plan at this point, but we believe we have a path to getting our pay ratio below 100%, driving free cash flow through all of the levers that Mirko and I have mentioned. Obviously, going forward, it is a tactic that we would have, but it's not on the cards right

Curtis Millen: Obviously, going forward, it is a tactic that we would have, but it's not in the cards right now.

Curtis Millen: Thank you.

Simon Flannery: Our next question is from Simon Flannery, from Morgan Stanley. Please go ahead. Great. Thank you very much. So thank you for the data on convergence and bundles. Very interesting. A number of the US companies and also Rogers are looking at fixed wireless to help provide essentially a national bundle. How are you thinking about whether you, how you address maybe areas where you don't have fun? Fiber, either in footprint or out of footprint, with either a fixed wireless or a resale type bundle?

Unknown Executive: Great. Thank you very much. So thank you for the data on convergence and bundles. Very interesting. A number of U.S. companies and also Rogers are looking at fixed wireless to help provide essentially a national bundle. How are you thinking about how you address maybe areas where you don't have fiber either in your footprint or out of it with either a fixed wireless or a resale type bundle? are on Twitter.

Mirko Bibic: Our strategy remains primarily focused on generating growth through our fiber superiority, and that's where the focus is. In other areas, we have the ability to combine TV product or content rather with wireless. But in 75% of the country where we have network overlap between fixed and wireless, really the emphasis is fiber. And we're seeing, as you mentioned, we're seeing very good results on bundling wireless and internet in fiber territory.

Unknown Executive: primarily focused on generating growth through our fiber superiority, and that's where the focus is. You know, in other areas, we have the ability to combine TV with other products.

Jérôme Zubre: Thank you. Before we take our next question, we would just like to remind you that if you're on the phone and wish to ask a question, please press star one. With that, our next question is from Jérôme Zubre, from Desjardins Securities. Please go ahead. Hey, good morning. Thanks for taking my questions. The first one, you know, it seems like we're transitioning a bit higher percentage of the subscriber base on wireless towards prepaid.

Operator: Thank you. Before we take our next question, we would just like to remind you that if you're on the phone and wish to ask a question, please press star one.

Unknown Executive: Hey, good morning. Thanks for taking my questions. The first one, you know, it seems like we're transitioning a bit higher percentage of the subscriber base on wireless towards prepaid. If you can discuss what's the margin, dollar margin profile on prepaid versus postpaid, are we talking about something that is similar across both types of services?

Jérôme Zubre: If you can discuss what's the margin, dollar margin profile on prepaid versus post beta, we're talking about something that is similar across both types of services. And second question is on capital allocation on wireless again, you know, where we have a government that makes it more difficult to earn returns on required wireless investments. We've talked a lot about the off-ex side of the equation, but what about wireless cat-ex, you know, excluding the new generations and new spectrum onboarding? How do you see wireless cat-ex evolving directionally in the future versus what it has been the last decade or so?

Unknown Executive: And the second question is on capital allocation on wireless again, you know, where you have a government that makes it more difficult to earn returns on required wireless investments. We've talked a lot about the OPEX side of the equation, but what about wireless CAPEX, you know, excluding the new generation, the new spectrum on boarding? How do you see wireless CAPEX evolving directionally in the future versus what it has been the last decade or so? Thanks.

Curtis Millen: Thanks.

Curtis Millen: Along the cat-ex question, whether or not it's wireless or waterline overall, you're going to, you've already seen a step down in our cat-ex year over year, and we're going to continue to, you know, lower the overall cat-backspans on next year will be lower than this year. And I think we can run this company at a capital intensity below 15%, which is a level where Bell operated historically for a long time. And I think we can do that while continuing to invest in the key strategic areas. And that's not the long term I'm talking about; the short to medium term there.

Curtis Millen: I'll leave it at that on CapEx. And then I draw a seatful look to show on the on your first question. So also we managed either done margins on a consolidated basis, and we don't provide prepaid only recording. I say ultimately we manage. As you've seen in our results quarter after quarter, we manage cost diligently, whether it's prepaid or postpaid, and we're looking to lower our cost to serve while providing the same great service to customers, again whether they're prepaid customers or postpaid customers. Thank you.

Batya Levi: Thank you. Our next question is from Batya Levi of UBS. Please go ahead.

Batya Levi: Our next question is from Batya Levi from UBS. Please go ahead. Thank you. On the revenue guidance, you're tracking below your guidance so far. I think it's mostly due to lower margin equipment revenues, but what are some drivers to get back to growth in the back of in the second half of the year. Also, if you could remind us revenue and need, but doubt contribution from out front media, that would be helpful. Thank you. Yeah.

David: So your guidance so far I think it's mostly due to lower margin equipment revenues, but what are some drivers to get back to a growth in the in the backup in the second half of the year and also if you could remind us revenue and EBITDA contribution from our Trumpf media that'd be helpful. Thank you.

Unknown Executive: Yeah, hi, Batya. Thanks for the question. So, as we said in our prepared remarks, we are reconfirming all of our guidance targets for 2024. I won't go through the laundry list of our revenue-generating tactics, but I would remind everyone that the majority of the revenue declines here have been driven by a decrease in very low margin product sales, which is consistent with our strategy of not chasing low value subscriber load.

Curtis Millen: Hi, Batya. Thanks for the question. So, as we said in our prepared remarks, we are reconfirming all of our guidance targets for 2024. I won't go through the laundry list of our revenue generating tactics, but what I would remind everyone is that the majority of the revenue declines here have been driven by a decrease in very low margin product sales, which is consistent with our strategy of not chasing low value subscriber lowings.

Speaker Change: Gotcha. Thanks for the question. So as we said in our prepared remarks, we are reconfirming all of our guidance targets for 2024.

Speaker Change: I'll go through the laundry list of our revenue generating tactics, but what I would remind everyone that the majority of the revenue declines here have been driven by a decrease in very low margin product sales, which is consistent with our strategy of not chasing low value subscriber loadings.

Curtis Millen: And on out front media? Yeah, and Outfront Media closed midway through June, so the contribution on revenue is single digits. I mean it's an immaterial number given the timeline of one that transaction closed.

Speaker Change: And on all fronts media.

Unknown Executive: and Out Front Media.

Curtis Millen: Okay, thank you. Thank you.

Operator: There are no further questions registered at this time.

Thane Fotopoulos: I would now like to turn the meeting over to Mr. Photopolis. Okay, great. Thank you, Matthew, and thanks again to everybody who participated on the call this morning.

Unknown Executive: Okay, great. Thank you, Matthew. And thanks again to everybody who participated on the call this morning. I'll give you back your 15 minutes so you can enjoy the nice summer day. As usual, the IR team will be available throughout the day for any follow-ups and clarifications on that. Have a good day, everybody. Thank you. Thanks, everyone.

Thane Fotopoulos: Now I'll give you back to your 15 minutes to enjoy the nice summer day. As usual, the IR team will be available throughout the day for any follow-ups and clarifications on that.

Thane Fotopoulos: Have a good day, everybody.

Operator: Thank you. Thanks everyone.

Operator: Thank you.

Operator: Please stand by and enjoy this music. If you wish to cue to ask a question, dial star 1. Music.

Operator: Meeting has ended. Goodbye.