Q4 2025 Cogeco Communications Inc Earnings Call

Speaker #3: Good day . And welcome to Cogeco . Welcome to Cogeco Inc. and Cogeco Communications , Inc. . Q4 2020 Earnings Conference Call . Today's conference is being recorded .

Operator: Welcome to Cogeco Inc. and Cogeco Communications Inc. Q4 2025 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Patrice Ouimet, Chief Financial Officer of Cogeco Inc. and Cogeco Communications Inc. Please go ahead, Mr. Ouimet.

Speaker #3: At this time , I would like to turn the conference over to Mr. Patrice Ouimet , Chief Financial Officer of Cogeco Inc. and Kogiku Communications , Inc. Please go ahead .

Speaker #3: Mr. Ouimet .

Speaker #4: Thank you . Operator . So good morning , everyone , and welcome to our fourth quarter conference call . So , as usual , before we begin the call , I'd like to remind listeners that today's discussion will include estimates and other forward looking information .

Patrice Ouimet: Thank you, operators. Good morning everyone. Welcome to our fourth quarter conference call. As usual, before we begin the call, I'd like to remind listeners that today's discussion will include estimates and other forward-looking information. We ask that you review the cautionary language in the press releases and annual report issued yesterday regarding the various risks, assumptions, and uncertainties that could cause our actual results to differ. With that, I'll pass the line to Frédéric Perron for opening remarks.

Patrice Ouimet: Thank you, operator. Good morning, everyone. Welcome to our Q4 conference call. As usual, before we begin the call, I'd like to remind listeners that today's discussion will include estimates and other forward-looking information. We ask that you review the cautionary language in the press releases and annual report issued yesterday regarding the various risks, assumptions and uncertainties that could cause our actual results to differ. With that, I'll pass the line to Frédéric Perron for opening remarks.

Speaker #4: We ask that you review the cautionary language in the press releases and annual report issued yesterday regarding the various risks , assumptions and uncertainties that could cause our actual results to differ .

Speaker #4: So with that , I'll pass the line to Fred Perrault for opening remarks . Thank you Patrice . Good morning everyone . For Cogeco Communications , the fourth quarter marked the end of year one of our three year transformation program focused on synergies , digital analytics , network expansion , and wireless .

Frédéric Perron: Thank you, Patrice. Good morning everyone. For Cogeco Communications Inc., the fourth quarter marked the end of year one of our three-year transformation program focused on synergies, digital analytics, network expansion, and wireless. We're pleased to report that we're on track. Year one was mainly focused on OpEx and CapEx synergies, and we delivered on those targets. As you can see by our 110 basis points year-on-year improvement in adjusted EBITDA margin and our $38 million year-on-year increase in free cash flow in constant currency. It's worth mentioning that the CapEx efficiency enabling our growth in free cash flow comes mainly from maintenance synergies as we're continuing to make important investments growing and enhancing our networks. A recent report by Ookla, for example, noted a significant increase in our Canadian upload speeds as a result of our ongoing network upgrade initiative.

Frédéric Perron: Thank you, Patrice. Good morning, everyone. For Cogeco Communications, the Q4 marked the end of year 1 of our 3-year transformation program focused on synergies, digital analytics, network expansion, and wireless. We are pleased to report that we're on track. Year 1 was, pardon, mainly focused on OpEx and CapEx synergies. We delivered on those targets, as you can see by our 110 basis points year-on-year improvement in adjusted EBITDA margin and our CAD 38 million year-on-year increase in free cash flow in constant currency. It's worth mentioning that the CapEx efficiency enabling our growth in free cash flow comes mainly from maintenance synergies as we're continuing to make important investments in growing and enhancing our networks. A recent report by Ookla, for example, noted a significant increase in our Canadian upload speeds as a result of our ongoing network upgrade initiative.

Speaker #4: And we're pleased to report that we're on track . Year one was pardoned , mainly focused on OpEx and CapEx synergies , and we delivered on those targets .

Speaker #4: As you can see by our 110 basis points year on year , improvement in adjusted EBITDA margin and our $38 million year on year increase in free cash flow in constant currency .

Speaker #4: It's worth mentioning that the CapEx efficiency enabling our growth in free cash flow comes mainly from maintenance synergies, as we're continuing to make important investments in growing and enhancing our networks.

Speaker #4: A recent report by Orkla for example , noted a significant increase in our Canadian upload speeds as a result of our ongoing network upgrade initiative .

Speaker #4: And in the US , we've upgraded over 35,000 of our cable doors to fiber during the fiscal year . In addition to adding nearly 50,000 new homes fast across our North American footprint , years two and three of our transformation will now add more emphasis on our top line performance .

Frédéric Perron: In the U.S., we've upgraded over 35,000 of our cable doors to fiber during the fiscal year. In addition to adding nearly 50,000 new homes passed across our North American footprint, years two and three of our transformation will now add more emphasis on our top-line performance as per our original plan. This will include additional investments in growing previously underdeveloped sales and marketing channels in the U.S. in the context of the evolving competitive environment as well as scaling wireless in Canada. When we met last quarter, we said that we were expecting strong continued Canadian customer growth combined with some improvements in our U.S. subscriber metrics, and we're pleased to be delivering on that expectation. We just had our best Canadian Internet customer growth in 13 years. This growth was driven mostly by market share gains in our legacy footprint on our own network.

Frédéric Perron: In the US, we've upgraded over 35,000 of our cable doors to fiber during the fiscal year, in addition to adding nearly 50,000 new homes fast across our North American footprint. Years 2 and 3 of our transformation will now add more emphasis on our top line performance as per our original plan. This will include additional investments in growing previously underdeveloped sales and marketing channels in the US in the context of the evolving competitive environment, as well as scaling wireless in Canada. When we met last quarter, we said that we were expecting strong continued Canadian customer growth combined with some improvements in our US subscriber metrics, and we're pleased to be delivering on that expectation. We just had our best Canadian internet customer growth in 13 years. This growth was driven mostly by market share gains in our legacy footprint on our own network.

Speaker #4: As per our original plan . This will include additional investments in growing previously underdeveloped sales and marketing channels in the US . In the context of the evolving competitive environment .

Speaker #4: As well as scaling wireless in Canada . When we met last quarter , we said that we were expecting strong , continued Canadian customer growth combined with some improvements in our US subscriber metrics , and we're pleased to be delivering on that expectation .

Speaker #4: We just had our best Canadian Internet customer growth in 13 years . This growth was driven mostly by market share gains in our legacy footprint on our own network .

Speaker #4: The completion of new rural expansion programs in Ontario has yet to accelerate through fiscal 26 and 27 , providing a new additional lever for us in the future .

Frédéric Perron: The completion of new rural expansion programs in Ontario has yet to accelerate through fiscal 2026 and 2027, providing a new additional lever for us in the future. We've seen a reduction in competitor promotional activity in the quarter, which has more than offset some minor noise around FWA and wholesale, including our own deployment as a reseller under the Cogeco brand across Quebec. It's fair to say that on balance, our Canadian competitive environment is evolving in a constructive manner. At present time, our launch of a Canadian wireless service is going ahead of plan, and October marked the deployment of this new service across most of our wireline operating footprint. Our positive early sales results on wireless have already enabled us to start pulling back on some of our initial introductory offers. On the U.S.

Frédéric Perron: The completion of new rural expansion programs in Ontario has yet to accelerate through fiscal 2026 and 2027, providing a new additional lever for us in the future. We've seen a reduction in competitor promotional activity in the quarter, which has more than offset some minor noise around FWA and wholesale, including our own deployment as a reseller under the Cogeco brand across Québec. It's fair to say that on balance, our Canadian competitive environment is evolving in a constructive manner at present time. Our launch of a Canadian wireless service is going ahead of plan, October marked the deployment of this new service across most of our wireline operating footprint. Our positive early sales results on wireless have already enabled us to start pulling back on some of our initial introductory offers.

Speaker #4: We've seen a reduction in competitor promotional activity in the quarter , which has more than offset some minor noise around FWA and wholesale , including our own deployment as a reseller under the Cogeco brand across Quebec .

Speaker #4: So it's fair to say that on balance , our Canadian competitive environment is evolving in a constructive manner . At present time . Our launch of a Canadian wireless service is going ahead of plan and October marked the deployment of this new service across most of our wireline operating footprint .

Speaker #4: Our positive early sales results on wireless have already enabled us to start pulling back on some of our initial introductory offers on the US side .

Frédéric Perron: On the US side, our year-on-year financials were impacted by ARPU pressures, the cumulative impact of customer losses in the prior quarters, a difficult comparative period last year, and a smaller rate increase this year than in the previous year. This resulted in a year-on-year decline in adjusted EBITDA, which was in line with what we had indicated to you last quarter. That being said, our additional sales and marketing activities are working. Our subscriber trends are now improving and we're delivering on our long-stated goal of growing the OXIO customer base during the quarter. In fact, it's the first time since we acquired the OXIO business 4 years ago that we achieved customer growth in that state. We expect continued improvements in our US subscriber metrics over the coming quarters.

Frédéric Perron: side, our year-on-year financials were impacted by ARPU pressures, the cumulative impact of customer losses in the prior quarters, a difficult comparative period last year, and a smaller rate increase this year than in the previous year. This resulted in a year-on-year decline in adjusted EBITDA, which was in line with what we had indicated to you last quarter. That being said, our additional sales and marketing activities are working, our subscriber trends are now improving, and we're delivering on our long-stated goal of growing the Ohio customer base during the quarter. In fact, it's the first time since we acquired the Ohio business four years ago that we achieved customer growth in that state. We expect continued improvements in our U.S. subscriber metrics over the coming quarters. On October 8th, we launched a completely revamped pricing strategy for the U.S.

Speaker #4: Our year on year financials were impacted by rpu pressures . The cumulative impact of customer losses in the prior quarters , a difficult comparative period last year , and a smaller rate increase this year than in the previous year .

Speaker #4: This resulted in a year on year decline in adjusted EBITDA , which was in line with what we had indicated to you last quarter .

Speaker #4: That being said, our additional sales and marketing activities are working. Our subscriber trends are now improving, and we're delivering on our long-stated goal of growing the Ohio customer base during the quarter.

Speaker #4: In fact , it's the first time since we acquired the Ohio business four years ago that we achieved customer growth in that state .

Speaker #4: We expect continued improvements in our U.S. subscriber metrics over the coming quarters. On October 8th, we launched a completely revamped pricing strategy for the U.S.

Frédéric Perron: On 8 October, we launched a completely revamped pricing strategy for the US. This new approach gives more value, predictability, and transparency to our customers, including full price protection for the first two years. This is just one of many tactics that we're deploying to be more aggressive and more innovative in our US go-to-market. Today, we're also publishing our consolidated guidance for the new fiscal year for CCA and CGO more broadly, which offers a continued growth in free cash flow in constant currency despite competition-driven top-line pressures. Our adjusted EBITDA guidance of 0% to -2% year-on-year reflects additional investments in scaling previously underdeveloped sales and marketing channels in the US and growing our Canadian wireless business, as previously explained. We believe these investments present attractive upside for us and are confident that investors will get disproportionate returns from them over time.

Speaker #4: This new approach gives more value , predictability and transparency to our customers , including full price protection . For the first two years .

Frédéric Perron: This new approach gives more value, predictability, and transparency to our customers, including full price protection for the first two years. This is just one of many tactics that we're deploying to be more aggressive and more innovative in our U.S. go-to-market today. We're also publishing our consolidated guidance for the new fiscal year for CCA and CGO more broadly, which offers continued growth in free cash flow in constant currency despite competition-driven top-line pressures. Our adjusted EBITDA guidance of 0% to -2% year-on-year reflects additional investments in scaling previously underdeveloped sales and marketing channels in the U.S. and growing our Canadian wireless business. As previously explained, we believe these investments present attractive upside for us and are confident that investors will get disproportionate returns from them over time.

Speaker #4: This is just one of many tactics that we're deploying to be more aggressive and more innovative in our US go to market . Today , we're also publishing our consolidated guidance for the new fiscal year for CAH and more broadly , which offers a continued growth in free cash flow in constant currency .

Speaker #4: Despite competition driven top line pressures . Our adjusted EBITDA guidance of 0% to -2% year on year reflects additional investments in scaling previously underdeveloped sales and marketing channels in the US and growing our Canadian wireless business .

Speaker #4: As previously explained , we believe these investments present attractive upside for us and our confident that investors will get disproportionate returns from them over time .

Speaker #4: We're still planning to grow our free cash flow to $600 million next year . In fiscal 2027 , which is a good base for further dividend growth .

Frédéric Perron: We're still planning to grow our free cash flow to $600 million next year in fiscal 2027, which is a good base for further dividend growth as we're announcing today, as well as further deleveraging. Finally, turning over to Cogeco Media, while competitive dynamics in the radio advertising market remain, Q4 revenue increased year-on-year, lifted by strength in our digital advertising solutions and continued listener engagement. On that, I'll turn it over to Patrice for more details on our results and guidance.

Frédéric Perron: We're still planning to grow our free cash flow to CAD 600 million next year in fiscal 2027, which is a good base for further dividend growth as we're announcing today, as well as further deleveraging. Finally, turning over to Cogeco Media. While competitive dynamics in the radio advertising market remain, Q4 revenue increased year-on-year, lifted by strength in our digital advertising solutions and continued listener engagement. On that, I'll turn it over to Patrice for more details on our results and guidance. Patrice.

Speaker #4: As we're announcing today , as well as further deleveraging . Finally , turning over to Cogeco Media . While competitive dynamics in the radio advertising market remain , Q4 revenue increased year on year , lifted by strength in our digital advertising solutions and continued listener engagement on that .

Speaker #4: I'll turn it over to Patrice for more details on our results and guidance. Patrice.

Patrice Ouimet: Patrice, thank you, Fred. In Canada, Cogeco Connexion's revenue declined by 1.5% in the fourth quarter, mainly due to lower revenue per customer from fewer video and wireline phone service subscribers, partly offset by growth in our Internet subscriber base, which added 17,000 new customers during the quarter. Adjusted EBITDA declined by 1.4% in constant currency due to the lower revenue being partially offset by lower operating expenses resulting from our cost reduction initiatives and operating efficiencies. We added 10,800 homes passed during the quarter, mainly through fiber-to-the-home under a network expansion program, including those related to the Ontario subsidized program. In the U.S., Breezeline's revenue declined by 9.2% in constant currency due to the cumulative decline in the subscriber base over the prior year, a smaller rate increase versus the prior year, along with a competitive pricing environment.

Speaker #5: Thank you Fred . So in Canada , Cogeco Connections revenue declined by 1.5% in the fourth quarter , mainly due to lower revenue per customer from fewer video and wireline phone service subscribers , partly offset by growth in our internet subscriber base , which added 17,000 new customers during the quarter .

Patrice Ouimet: Thank you, Frédéric. In Canada, Cogeco Connexion revenue declined by 1.5% in Q4, mainly due to lower revenue per customer from fewer video and wireline phone service subscribers, partly offset by growth in our internet subscriber base, which added 17,000 new customers during the quarter. Adjusted EBITDA declined by 1.4% in constant currency due to the lower revenue being partially offset by lower operating expenses resulting from our cost reduction initiatives and operating efficiencies. We added 10,800 homes passed during the quarter, mainly through fiber to the home under a network expansion program, including those related to the Ontario subsidized program.

Speaker #5: Adjusted EBITDA declined by 1.4% in constant currency due to lower revenue, which was partially offset by reduced operating expenses resulting from debt reduction.

Speaker #5: Initiatives and operating efficiencies . We added 10,800 homes during the quarter , mainly through fiber to the home under a network expansion program , including those related to the Ontario subsidized program in the US , breeze lines revenue declined by 9.2% in constant currency due to the cumulative decline in the subscriber base over the prior year .

Patrice Ouimet: In the US, Breezeline's revenue declined by 9.2% in constant currency due to the cumulative decline in the subscriber base over the prior year, a smaller rate increase in versus the prior year, along with a competitive pricing environment. The 6,300 decline in internet subscribers was an improvement over the previous quarter, while internet subscriber additions in OXIO recorded their first-ever positive growth of 1,300 new subscribers. Adjusted EBITDA declined by 7.9% in constant currency due to lower revenue, offset in part by lower operating expenses driven by cost reduction initiatives and operating efficiencies. Note that last year's comparative Q4 period was the highest EBITDA level of all quarters for that year, largely due to the reorganization of our operating entities. Now turning to our consolidated numbers for Cogeco Communications.

Speaker #5: A smaller rate increase in versus the prior year , along with a competitive pricing environment . The 6300 decline in internet subscribers was an improvement over the previous quarter , while internet subscriber additions in Ohio recorded their first ever positive growth of 1300 new subscribers , adjusted EBITDA declined by 7.9% in constant currency due to lower revenue , offset in part by lower operating expenses driven by cost reduction initiatives and operating efficiencies .

Patrice Ouimet: The 6,300 decline in Internet subscribers was an improvement over the previous quarter, while Internet subscriber additions in Ohio recorded their first ever positive growth of 1,300 new subscribers. Adjusted EBITDA declined by 7.9% in constant currency due to lower revenue, offset in part by lower operating expenses driven by cost reduction initiatives and operating efficiencies. Last year's comparative Q4 period was the highest EBITDA level of all quarters for that year, largely due to the reorganization of our operating entities. Now turning to our consolidated numbers for Cogeco Communications Inc. At the consolidated level, revenue in constant currency declined by 5.3% and adjusted EBITDA declined by 3.3%. This result is mainly due to the revenue pressure in the U.S., partially offset by strong execution on operating efficiencies as well as customer growth.

Speaker #5: Note that last year's comparative Q4 period was the highest EBITDA level of all quarters . For that year , largely due to the reorganization of our operating entities .

Speaker #5: Now , turning to our consolidated numbers for Cogeco Communication at the consolidated level , revenue in constant currency declined by 5.3% and adjusted EBITDA declined by 3.3% .

Patrice Ouimet: At the consolidated level, revenue and constant currency declined by 5.3%, and adjusted EBITDA declined by 3.3%. This result is mainly due to the revenue pressure in the US, partially offset by strong execution on operating efficiencies as well as customer growth in Canada. Diluted earnings per share declined by 6.2% in reported currency, mainly due to lower EBITDA and higher financial and restructuring costs. Capital intensity was up at 21.8% versus 20.4% last year. Free cash flow and constant currency decreased by 27.4% in the quarter but was up by 7.9% for the full year. Our net debt to adjusted EBITDA ratio was 3.1x at the end of the quarter, unchanged from the level reported in Q3.

Speaker #5: This result is mainly due to the revenue pressure in the US , partially offset by strong execution on operating efficiencies , as well as customer growth in Canada .

Patrice Ouimet: In Canada, diluted earnings per share declined by 6.2% in reported currency, mainly due to lower EBITDA and higher financial and restructuring costs. Capital intensity was up at 21.8% versus 20.4% last year. Free cash flow in constant currency decreased by 27.4% in the quarter but was up by 7.9% for the full year. Our net debt to adjusted EBITDA ratio was 3.1 turns at the end of the quarter, unchanged from the level reported in Q3. We have increased our dividend by 7%, having declared a quarterly dividend of $0.987 per share, and as Frank mentioned, with anticipated strong free cash flow in fiscal 2026 and 2027, we expect to continue to increase dividends meaningfully in the future. At Cogeco Inc., our revenue in constant currency decreased by 5% and adjusted EBITDA declined by 3.9%, with growth in radio partially offsetting revenue declines at Cogeco Communications.

Speaker #5: Diluted earnings per share declined by 6.2% in reported currency , mainly due to lower EBITDA and higher financial and restructuring costs . Capital intensity was up 20 , was up at 21.8% versus 20.4% last year .

Speaker #5: Free cash flow in constant currency decreased by 27.4% in the quarter but was up by 7.9% for the full year. Our net debt to adjusted EBITDA ratio was 3.1 turns at the end of the quarter, unchanged from the level reported in Q3.

Speaker #5: We have increased our dividend by 7% , having declared a quarterly dividend of 98.7 cents per share , and as Fred mentioned with anticipated strong free cash flow in fiscal 26 and 27 , we expect to continue to increase dividends meaningfully in the future .

Patrice Ouimet: We have increased our dividend by 7%, having declared a quarterly dividend of CAD 0.987 per share. As Fred Pérault mentioned, with anticipated strong free cash flow in fiscal 2026 and 2027, we expect to continue to increase dividends meaningfully in the future. At Cogeco Inc., our revenue and constant currency decreased by 5%, and adjusted EBITDA declined by 3.9%, with growth in Cogeco Media partially offsetting revenue declines at Cogeco Communications. Media operations revenue increased by 8.5%, driven by growth in digital advertising revenue. We have also increased the dividend at Cogeco Inc. by 7% in lockstep with that at Cogeco Communications. Let's now discuss our fiscal 2026 guidance, which we are introducing today.

Speaker #5: At Cogeco Inc. , our revenue in constant currency decreased by 5% and adjusted EBITDA declined by 3.9% , with growth in radio partially offsetting revenue declines at Cogeco Communications , media operations , revenue increased by 8.5% , driven by growth in digital advertising revenue .

Patrice Ouimet: Media operations revenue increased by 8.5%, driven by growth in digital advertising revenue. We have also increased the dividend at Cogeco Inc. by 7% in lockstep with that at Cogeco Communications. Let's now discuss our fiscal 2026 guidance, which we are introducing today. On a constant currency and consolidated basis, Cogeco Communications expects revenue to decrease between 1% and 3% compared to the prior year, as growth in Canada is offset by competitive pressures in the U.S. Adjusted EBITDA is anticipated to decrease between 0% and 2% versus last year as we continue to face revenue pressures in the U.S. and are investing in new sales and marketing capabilities, especially in the U.S. as part of our three-year transformation program, all while generating additional operational efficiencies.

Speaker #5: We have also increased the dividend at Cogeco Inc. by 7% , in lockstep with that at Cogeco Communications . Let's now discuss our fiscal 26 guidance , which we are introducing today .

Speaker #5: On a constant currency and consolidated basis , Cogeco Communication expects revenue to decrease between 1 and 3% compared to the prior year , as growth in Canada is offset by competitive pressures in the US .

Patrice Ouimet: On a constant currency and consolidated basis, Cogeco Communications expects revenue to decrease between 1% and 3% compared to the prior year, as growth in Canada is offset by competitive pressures in the US. Adjusted EBITDA is anticipated to decrease between 0% and 2% versus last year as we continue to face revenue pressures in the US and are investing in new sales and marketing capabilities, especially in the US, as part of our three-year transformation program. All while generating additional operational efficiencies. We will also incur some costs related to our Canadian wireless operations, including some IT costs recognized in adjusted EBITDA starting in fiscal 2026. I'll get back to this in a second.

Speaker #5: Adjusted EBITDA is anticipated to decrease between 0 and 2% versus last year , as we continue to face revenue pressures in the US and our investing in new sales and marketing capabilities , especially in the US , as part of our three year transformation program , all while generating additional operational efficiencies .

Speaker #5: We will also incur some costs related to our Canadian wireless operations , including some IT costs recognized in adjusted EBITDA starting in fiscal 26 .

Patrice Ouimet: We will also incur some costs related to our Canadian wireless operations, including some IT costs recognized in adjusted EBITDA starting in fiscal 2026, and I'll get back to this in a second. Turning to our capital expenditures, we are expecting to spend between $560 million and $600 million, including $100 million to $140 million in growth-oriented network expansions, resulting in a capital intensity of between 19% and 21%, or 15% and 17% excluding those network expansion projects. Free cash flow and free cash flow excluding network expansions are expected to increase between 0% and 10% compared to fiscal 2025. Our full-year current tax rate is forecast to be 11.5%. In terms of segments, an important item to note is that beginning in Q1 of fiscal 2026, Canadian mobility, which had been included in our corporate segment during the startup phase, will now be recorded in our Canadian segment.

Speaker #5: And I'll get back to this in a second . Turning to our capital expenditures , we are expecting to spend between 560 million and 600 million , including 100 to 140 million in growth oriented network expansions , resulting in a capital intensity of between 19 and 21% or 15 and 17% excluding those network expansion projects .

Patrice Ouimet: Turning to our capital expenditures, we are expecting to spend between CAD 560 and 600 million, including CAD 100 to 140 million in growth-oriented network expansions, resulting in a capital intensity of between 19% and 21% or 15% and 17%, excluding those network expansion projects. Free cash flow and free cash flow, excluding network expansions, are expected to increase between 0% and 10% compared to fiscal 2025. Our full-year current tax rate is forecast to be 11.5%. In terms of segments, an important item to note is that beginning in Q1 of fiscal 2026, Canadian Mobility, which had been included in our corporate segment during the startup phase, will now be recorded in our Canadian Segment, given the recent full-scale launch of the product.

Speaker #5: Free cash flow and free cash flow , excluding network expansions , are expected to increase between 0 and 10% compared to fiscal 25 .

Speaker #5: Our full year current tax rate is forecast to be 11.5% . In terms of segments , an important item to note is that beginning in Q1 of fiscal 26 , Canadian Mobility , which had been included in our corporate segment during the start of phase , will now be recorded in our Canadian segment .

Speaker #5: Given the recent full scale launch of the product , this reclassification will have no impact on the consolidated level and comparative segments for the prior year .

Patrice Ouimet: Given the recent full-scale launch of the product, this reclassification will have no impact on the consolidated level and comparative segments for the prior year, and we will also adjust basically the results for the prior year for that. In addition, our IT costs related to Canadian mobility, which were recognized below the EBITDA line as cloud computing costs in fiscal 2025 during the implementation period, will be recognized as OPEX within the Canadian segment starting in Q1, as those systems are now in operation. Overall, we expect the fiscal 2026 Canadian segments adjusted EBITDA to be impacted by about $20 million versus what we reported in fiscal 2025. Of that, $11 million is simply the reclassification from corporate OpEx to the Canadian business, and the balance is moving from below the EBITDA line to OpEx. That's basically the IT systems I was relating to.

Patrice Ouimet: This reclassification will have no impact on the consolidated level and comparative segments for the prior year. We will also adjust basically the results for the prior year for that. In addition, our IT costs related to Canadian mobility, which were recognized below the EBITDA line as cloud computing costs in fiscal 2025 during the implementation period, will be recognized as OpEx within the Canadian segment starting in Q1 as those systems are now in operation. Overall, we expect the fiscal 2026 Canadian segment's adjusted EBITDA to be impacted by about CAD 20 million versus what we reported in fiscal 2025. Of that, CAD 11 million is simply the reclassification from corporate OpEx to the Canadian business, and the balance is moving from below the EBITDA line to OpEx. That's basically the IT systems I was relating to.

Speaker #5: And we will also adjust basically , the results for the prior year for that . In addition , our IT costs related to Canadian mobility , which were recognized below the line as cloud computing costs in fiscal 25 during the implementation period , will be recognized as OpEx within the Canadian segment .

Speaker #5: Starting in Q1 , as those systems are now in operation . So overall , we expect the fiscal 26 Canadian segment's adjusted EBITDA to be impacted by about $20 million versus what we reported in fiscal 25 .

Speaker #5: Of that, $11 million is simply the reclassification from corporate opex to the Canadian business. And the balance is moving from below the EBITDA line to opex.

Speaker #5: That's basically the IT systems I was relating to . We . Nevertheless , expect the Canadian operations growth to largely absorb those additional costs in fiscal 26 through customer growth and operational efficiencies as it relates to Q1 .

Patrice Ouimet: We nevertheless expect the Canadian operations growth to largely absorb those additional costs in fiscal 2026 through customer growth and operational efficiencies. As relates to Q1, we expect consolidated revenue and adjusted EBITDA to decline in the mid single-digit range in constant currency. We then expect a material sequential improvement in our year-over-year adjusted EBITDA trends starting in the second quarter as we benefit from already quantified cost savings, rate increases, and improving U.S. customer trends. More specifically, in the U.S., we expect the Q1 year-on-year adjusted EBITDA variation to be slightly better than the Q4 variation that we just reported, followed by solid gradual improvements as we benefit from easier year-on-year comps in addition to the aforementioned factors at the consolidated level in Q1.

Patrice Ouimet: We nevertheless expect the Canadian operations growth to largely absorb those additional costs in fiscal 2026 through customer growth and operational efficiencies. As it relates to Q1, we expect consolidated revenue and adjusted EBITDA to decline in the mid-single-digit range in constant currency. We expect a material sequential improvement in our year-over-year adjusted EBITDA trends starting in Q2 as we benefit from already quantified cost savings, rate increases, and improving US customer trends. More specifically, in the US, we expect the Q1 year-on-year adjusted EBITDA variation to be slightly better than the Q4 variation that we just reported, followed by solid gradual improvements as we benefit from easier year-on-year comps in addition to the aforementioned factors. At the consolidated level in Q1, with our restructuring program largely completed, we do not expect material acquisition, integration, and restructuring costs in the quarter.

Speaker #5: We expect consolidated revenue and adjusted EBITDA to decline in the mid-single digit range in constant currency . We then expect a material sequential improvement in our year over year adjusted EBITDA trends starting in the second quarter .

Speaker #5: As we benefit from already quantified cost savings rate increases and improving US customer trends . More specifically , in the US , we expect the Q1 year on year adjusted EBITDA variation to be slightly better than the Q4 variation that we just reported , followed by solid , gradual improvements as we benefited from easier year on year comps .

Speaker #5: In addition to the aforementioned factors . The consolidated level in Q1 with our restructuring program largely completed , we do not expect material acquisition , integration and restructuring costs in the quarter , and we expect our financial expense to about to be about 10 million less than in the prior quarter .

Patrice Ouimet: With our restructuring program largely completed, we do not expect material acquisition, integration, and restructuring costs in the quarter, and we expect our financial expense to be about $10 million less than in the prior quarter in Q4, while our depreciation and amortization expense should be about $4 million lower than in Q4. Finally, at Cogeco Inc., we have issued the same financial guidelines as Cogeco Communications Inc. with the exception of net capital expenditures, and now Fred and I will be happy to take your questions.

Patrice Ouimet: We expect our financial expense to be about CAD 10 million less than in the prior quarter in Q4. While our depreciation and amortization expense should be about CAD 4 million lower than in Q4. Finally, at Cogeco Inc, we have issued the same financial guidelines as Cogeco Communications, with the exception of net capital expenditures. Now, Fred and I will be happy to take your questions.

Speaker #5: In Q4 . While our depreciation and amortization expense should be about 4 million lower than in Q4 . Finally , at Cogeco Inc. , we have issued the same financial guidelines as Cogeco Communications with the exception of net capital expenditures .

Speaker #5: And now Fred and I will be happy to take your questions .

Speaker #3: Thank you . Ladies and gentlemen , we will now begin the question and answer session . Did you have a question ? Please press star followed by the one on your touchtone phone .

Operator: Thank you, ladies and gentlemen. We will now begin the question and answer session. Should you have a question, please press STAR followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press STAR followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Aravinda Galapati with Canaccord Genuity. Your line is now open.

Operator: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star followed by the one on your touch-tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment please for your first question. Your first question comes from Aravinda Galappatthige with Canaccord Genuity. Your line is now open.

Speaker #3: You will hear prompt . Your hand has been raised should you wish to decline from the polling process , please press star followed by the two .

Speaker #3: If you are using a speakerphone , please lift the handset before pressing any keys . One moment please . For your first question .

Speaker #3: Your first question comes from Aravinda . Garlapati with Canaccord Genuity . Your line is now open .

Speaker #6: Good morning . Thanks for taking my question . I just wanted to pick up on the the sort of the comments around the IT spend in wireless a bit more broadly , given that you've launched now and it's deployed across the footprint , are you able to sort of update us on sort of the total impact on Canadian EBITDA or the expectation that's built into fiscal 2026 ?

Frédéric Perron: Good morning.

Aravinda Galappatthige: Good morning. Thanks for taking my question. I just wanted to pick up on the sort of the comments around the IT spend in wireless. A bit more broadly, given that you've launched now and it's deployed across the footprint, are you able to sort of update us on sort of the total impact on Canadian EBITDA or the expectation that's built into fiscal 2026? I know about that, you talked about the CAD 9 million incremental piece of IT, but more broadly, given sort of the pricing changes you've done, just wanted to see how much of a drag it could create in H1 or even for the full year. Maybe start there.

[Analyst 1]: Thanks for taking my question. I just wanted to pick up on the comments around the IT spend in wireless. A bit more broadly, given that you've launched now and it's deployed across the footprint, are you able to update us on the total impact on Canadian EBITDA or the expectation that's built into fiscal 2026? I know you talked about the $9 million incremental piece from it, but more broadly, given the pricing changes you've done, just wanted to see how much of a drag it could create in the first half or even for the full year. Maybe start there.

Speaker #6: I know about that . You talked about the 9 million incremental piece of it , but more broadly , given sort of the pricing changes you've done , just wanted to see how much of a drag it could create in the first half , or even for the full year , maybe start there .

Speaker #5: Sure . So good morning . So yeah . So just the reclassification of some opex from corporate to , to our Canadian business .

Frédéric Perron: Sure.

Patrice Ouimet: Sure. Good morning. Just the reclassification of some OpEx from corporate to our Canadian business and moving some IT costs from below the line to above the EBITDA line will create pressure of about CAD 20 million on our Canadian numbers. Obviously, it doesn't change anything at the, especially for free cash flow, if you look at the full company. 2 reclassifications. One will basically show the comparative values that will be adjusted in the prior year. That's basically what's moving from corporate to our Canadian business. The other one will not be reclassified in the past, basically, as this is moving forward. That's the IT cost.

Patrice Ouimet: Good morning. The reclassification of some OpEx from corporate to our Canadian business and moving some IT costs from below the line to above the EBITDA line will create pressure of about $20 million on our Canadian numbers. Obviously, it doesn't change anything, especially for free cash flow. If you look at the full company, it's two reclassifications. One will basically show the comparative values that will be adjusted in the prior year. That's basically what moving from corporate to our Canadian business is. The other one will not be reclassified in the past. As this is moving forward, that's the IT cost. That being said, as I was saying earlier, we are expecting growth in our Canadian business otherwise at the EBITDA line, so we should normally be able to absorb this.

Speaker #5: And moving some it costs from below the line to above the EBITDA line will create pressure of about 20 million of our on our Canadian numbers .

Speaker #5: Obviously it doesn't change anything at the especially for free cash flow . If you look at the full company , it's a . Two reclassifications one will will basically show the comparative values that that will be adjusted in the prior year .

Speaker #5: That's basically what we're moving from corporate to in business . The other one will not be reclassified in the past . Basically , as this is moving forward .

Speaker #5: That's the it cost . That being said , as I was saying earlier , we are expecting growth in our Canadian business . Otherwise at the at the EBITDA line .

Patrice Ouimet: That being said, as I was saying earlier, we are expecting growth in our Canadian business otherwise at the EBITDA line. We should normally be able to absorb this. To your wider question on, if I got your question right, on what mobility does for us, obviously we're starting from basically a very small number. I wouldn't say that the numbers will be meaningful in terms of the benefits in year, because obviously we're starting from a small base. We do see benefits, and we've been very successful with the launch so far, and we see a lot of interest from our customers.

Speaker #5: So we should normally be able to absorb this to your wider question on if I got your question right , on what mobility , mobility does for us , obviously we're starting from basically a very small number .

Patrice Ouimet: To your wider question, if I got your question right, on what mobility does for us, we're starting from basically a very small number. I wouldn't say that the numbers will be meaningful in terms of the benefits in year because we're starting from a small base. We do see benefits and we've been very successful with the launch so far. We see a lot of interest from our customers. Again, to remind you, the goal with mobility is primarily to bundle services for our customers or non-customers that are neighbors of our customers in the regions that we serve. It can be used in acquisition, it can be used in retention as well.

Speaker #5: So I wouldn't say that the numbers will be meaningful in terms of in terms of the benefits in year , because obviously we're starting from a small base , but we do see benefits , and we've been very successful with the launch so far .

Speaker #5: And we see a lot of interest from our customers . And again , to remind you , the goal with mobility is primarily to bundle services for our customers or non-customers that are neighbors of our customers in the regions that we serve .

Patrice Ouimet: Again, to remind you, the goal with mobility is primarily to bundle services for our customers, or non-customers that are neighbors of our customers in the regions that we serve. It can be used in acquisition, it can be used in retention as well.

Speaker #5: It can be used in acquisition . It can be used in retention as well .

Speaker #6: Thanks , Patrice . And then just sort of maybe just turning to the US , the wireless sort of experience so far . Is there anything any feedback you can provide or share in terms of , you know , how the churn profiles have been impacted by your wireless launch ?

[Analyst 1]: Thanks, Patrice. Maybe just turning to the U.S., the wireless sort of experienced so far. Is there anything, any feedback you can provide or share in terms of how the churn profiles have been impacted by your wireless launch? I realize it's early, so perhaps it's not much, but anything you can share would be interesting.

Aravinda Galappatthige: Thanks, Patrice. Then, just sort of maybe just turning to the US, the wireless experience so far, is there anything, any feedback you can provide or share in terms of, you know, how the churn profiles have been impacted by your wireless launch? I realize it's early, so perhaps it's not much, but anything you can share would be interesting.

Speaker #6: I realize it's early , so perhaps it's it's it's not much , but anything you can share would be interesting .

Speaker #4: Hi Aravinda , it's Fred . Yes , we've analyzed it and we see a materially lower churn in the US from customers also taking wireless from us .

Frédéric Perron: Hi Aravinda, it's Frédéric. Yes, we've analyzed it and we see materially lower churn in the U.S. from customers also taking wireless from us. Now, we have to be cautious because some of that is simply self-selection. Customers who like us better, less likely to churn, are more likely to buy wireless anyways. The churn difference is so pronounced that we believe at present time that there's a benefit above and beyond self-selection as it relates to churn benefit from wireless.

Frédéric Perron: Hi, Aravinda, it's Fred. Yes, we've analyzed it, we see a materially lower churn in the US from customers also taking wireless from us. We have to be cautious because some of that is simply self-selection. Customers who like us better are less likely to churn are more likely to buy wireless anyways. The churn difference is so pronounced that we believe at present time that there's a benefit above and beyond self-selection as it relates to churn benefit from wireless.

Speaker #4: Now we have to be cautious because some of that is simply self-selection. So, customers who like us better, and are less likely to churn, are more likely to buy wireless anyways.

Speaker #4: But the churn difference is so pronounced that we believe at present time that there's a benefit above and beyond self-selection as it relates to churn .

Speaker #4: Benefit from wireless .

Speaker #6: Okay . Thank you Fred . And then lastly , just a bigger picture question on the fiscal 26 guide . I know you've talked about what Q1 would be like .

[Analyst 1]: Okay, thank you, Frédéric. Lastly, just a bigger picture question on the fiscal 2026 guide. I know, Patrice, you talked about what Q1 would be like. Is it fair to suggest that the guide still assumes a close to mid single digit decline in the U.S. as far as adjusted EBITDA is concerned, and then a little bit of catch up in Canada, or is it low single digits? Both. Both geographies.

Aravinda Galappatthige: Okay. Thank you, Fred. Lastly, just a bigger picture question on the fiscal 2026 guide. I know, Patrice, you've talked about what Q1 would be like. Is it fair to suggest that the guide still assumes a close to mid-single digit decline in the US as far as EBITDA is concerned, and then a little bit of catch up in Canada? Or is it low single digits, both geographies?

Speaker #6: Is it fair to suggest that the guide still assumes a close to mid-single digit decline in the US as far as EBITDA is concerned ?

Speaker #6: And then a little bit of catch up in Canada , or is it low single digits ? Both . Both geographies .

Speaker #5: Yeah . So we've yeah , I haven't commented really on what we expect for the full year , but I could say for , for what we're assuming in the US for the full year at the habitat level , obviously in constant currency , we should do better than than your assumption of mid-single digit , given that we see a better good improvement in the customer situation because we did lose a lot of customers in the prior year , and we're expecting to do a lot better there .

Patrice Ouimet: Yeah. I haven't commented really on what we expect for the full year, but I could say for what we're assuming in the U.S. for the full year at the EBITDA level, obviously in constant currency, we should do better than your assumption of mid single digit given that we see a good improvement in the customer situation because we did lose a lot of customers in the prior year and we're expecting to do a lot better there. We've implemented a lot of tactics as well to achieve this and also to manage how we price our products, how we handle it in retention. Our program, our three year transformation program, is continuing and we have further cost improvements that we are planning to bank on. We talked about the chatbots before. We've changed our phone systems as well, our automated phone systems that now have AI components.

Patrice Ouimet: Yeah. I haven't commented really on what we expect for the full year, but I could say, for what we're assuming in the US for the full year at the EBITDA level, obviously in constant currency, we should do better than your assumption of mid-single digit. Given that we see a better, good improvement in the customer situation, 'cause we did lose a lot of customers in the prior year, we're expecting to do a lot better there. We've implemented a lot of tactics as well to achieve this and also to manage how we price our products, how we handle it in retention.

Speaker #5: We've implemented a lot of tactics as well to to , to to achieve this and also to manage how we price our products , how we handle it in retention and our program , our three year transformation program is continuing .

Patrice Ouimet: Our program, our 3-year transformation program is continuing, and we have further cost improvements that we are planning to bank on. We talked about the chatbots before. We’ve changed our phone systems as well, our automated phone systems that now have AI components. These are just examples, but there’s other elements as well in our programs that will kick in in the year.

Speaker #5: And we have further cost improvements that we are planning to bank on . We talked about the chatbots before . We've changed our phone systems as well .

Speaker #5: Automated phone systems that now have AI components . These are just examples , but there's other other elements as well . In our programs that will kick in in the in the year .

Patrice Ouimet: These are just examples. There are other elements as well in our programs that will kick in in the year.

Speaker #4: The other thing I would say about the US Arvind is we've done a lower rate increase over the past year than we had in prior year in an effort to to de-risk the Arppu that obviously you can see in our Q4 results in the US , and you'll see in our Q1 results a little bit as well .

Frédéric Perron: The other thing I would say about the U.S., Aravind, is we've done a lower rate increase over the past year than we had in the prior year in an effort to de-risk the ARPU. That obviously you can see in our Q4 results in the U.S., and you'll see in our Q1 results a little bit as well. As we go into the next year, we have an opportunity to do rate increases in some segments that were not captured before. It doesn't mean we'll do very large rate increases, but there are some segments that were previously not fully exploited, and therefore we do see a bit of revenue upside from that starting in the second and third quarter.

Frédéric Perron: The other thing I would say about the US, Aravinda Galappatthige, is we've done a lower rate increase over the past year than we had in prior year in an effort to de-risk the ARPU. That obviously you can see in our Q4 results in the US, and you'll see in our Q1 results a little bit as well. As we go into the next year, we have an opportunity to do rate increases in some segments that were not captured before. It doesn't mean we'll do very large rate increases, but there are some segments that were previously not fully exploited, and therefore, we do see a bit of revenue upside from that starting in Q2 and Q3.

Speaker #4: But as we go into the next year, we have an opportunity to do rate increases in some segments that we haven't captured before.

Speaker #4: So it doesn't mean we'll do very large rate increases . But there are some segments that we're previously not fully exploited and therefore we do see a bit of revenue upside from that starting in the second and third quarter .

Speaker #6: Thank you . I'll pass the line .

[Analyst 1]: Thank you. I'll pass the line.

Aravinda Galappatthige: Thank you. I'll pass the line.

Speaker #3: Your next question comes from Vince Valentini with TD Bank . Your line is now open .

Operator: Your next question comes from Vince Valentini with TD Bank. Your line is now open.

Operator: Your next question comes from Vince Valentini with TD Bank. Your line is now open.

Speaker #7: Hey thanks , guys . Thanks for the extra detail on the wireless Canadian impact . Can I ask one other item on that ?

[Analyst 2]: Hey, thanks guys. Thanks for the extra detail on the Canadian wireless net impact. Can I ask one other item on that? You seem like you had a very strong start out of the gates. As you even say, you slowed down your marketing and pricing efforts as a result of that. Given all the customers you had out of the gates taking a free line for a year, you still have to pay the wholesale fees on that. Is that not a potential incremental drag on your EBITDA in the Canadian segment in 2026 as well?

Vince Valentini: Hey, thanks guys. Thanks for the extra detail on the wireless Canadian net impact. Can I ask one other item on that is you've seemed like you had a very strong start out of the gates, as you even say, you slowed down your marketing and pricing efforts as a result of that. Given all the customers you had out of the gates taking a free line for a year, you still have to pay the wholesale fees on that. Is that not a potential incremental drag on your EBITDA in the Canadian segment in 2026 as well?

Speaker #7: Is , you seem like you had a very strong start out of the gates as you even say , you slowed down your your marketing and pricing efforts as a result of that , given all the customers you had out of the gates , taking a free line for a year , you still have to pay the wholesale fees on that .

Speaker #7: Is that not a potential incremental drag on your your EBITDA in in the Canadian segment in 2026 as well ?

Speaker #5: Yeah , it's well , by the way , we we had different types of products . So we we do we do have paying customers as well .

Patrice Ouimet: By the way, we have different types of products, so we do have paying customers as well. This is linked also with them being customers with Internet and maybe other products as well, but the numbers are still small. We're starting when you compare it to the size of our business in Canada, it's factored in our guidance, but I wouldn't say it's a lot. We have a bit more marketing costs we're doing obviously as we launched, but not that material.

Patrice Ouimet: Yeah. Well, by the way, we have different types of products. We do have paying customers as well. Again, this is linked also with them being customers with internet and maybe other products as well. The numbers are still small, right? We're starting When you compare it to the size of our business in Canada, it's factored into our guidance. I wouldn't say it's a lot. We have a bit more marketing costs we're doing, obviously, as we launch, but not that material.

Speaker #5: But, and again this is linked also with them being customers with internet and maybe other products as well. But the numbers are still small, right?

Speaker #5: We're starting when you compare it to the size of our business in , in Canada , it it's factored in our guidance . But I wouldn't say it's it's a lot .

Speaker #5: We have a bit more marketing costs . We're doing obviously as we launched but not that material .

Speaker #4: Yeah . Vince , the the launch promotion was something that that was budgeted and is in our forecast . We thought it was an efficient way of getting started .

Frédéric Perron: Yeah, Vince, the launch promotion was something that was budgeted and is in our forecast. We thought it was an efficient way of getting started. We consider it almost a marketing investment. As you've said, we've already pulled back, and at this time the free line for a year is only available on our talk and text plan without data, which very few customers take.

Frédéric Perron: Yeah. Vince, the launch promotion was something that was budgeted and is in our forecast. We thought it was an efficient way of getting started, so we consider it almost a marketing investment. As you've said, we've already pulled back, and at this time, the free line for a year is only available on our talk and text plan without data, which very few customers take.

Speaker #4: So we consider it almost a marketing investment . But as you've said , we've already pulled back . And at this time the free line for a year is only available on our talk and text plan without data , which very few customers take .

Speaker #7: Okay . Thanks . Sticking with Canada and the more disciplined pricing environment you're seeing , does that not open up some opportunities for rate increases on your platform and I know you don't like to talk about them before they're announced to your customers , but is there any broad sense you can give us as to what you've baked into your guidance for , for Rpu growth in Canada ?

[Analyst 2]: Okay, thanks. Sticking with Canada and the more disciplined pricing environment you're seeing, does that not open up some opportunities for rate increases on your platform? I know you don't like to talk about them before they're announced to your customers, but is there any broad sense you can give us as to what you've baked into your guidance for ARPU growth in Canada?

Vince Valentini: Okay, thanks. Sticking with Canada and the more disciplined pricing environment you're seeing, does that not open up some opportunities for rate increases on your platform? I know you don't like to talk about them before they're announced to your customers. Is there any broad sense you can give us as to what you've baked into your guidance for ARPU growth in Canada?

Speaker #5: Yeah , so I think we'll stick with our policy of not talking about it in advance , but I would say generally we do have some price increases that we that are reasonable in our different products , especially for video and internet .

Patrice Ouimet: Yeah. I think we'll stick with our policy of not talking about it in advance. I would say generally we do have some price increases that are reasonable in our different products, especially for video and Internet. Normally we put out guidance like this. We do have an expectation when they obviously they don't cover the full year. As they're put through during the year, we did have some in recently that will impact the full year, but it varies by product.

Patrice Ouimet: I think we'll stick with our policy of not talking about it in advance. I would say generally, we do have some price increases that are reasonable in our different products, especially for video and internet. Normally, when we put out guidance like this, we do have an expectation. Obviously, they don't cover the full year, and as they're put through during the year. We did have some in recently that will impact the full year, but it varies by product.

Speaker #5: So normally when we put out guidance like this , we do have an expectation when they obviously they don't cover the full year and as they're put through during the year , we did have some in recently that will impact the full year .

Speaker #5: But it varies by product . .

Speaker #4: And I'll just add beyond the rate increases that we do . Obviously our reality of our business for the past many years is that new customers come in at our lower rate than existing customers , but with a more rational pricing environment is we're seeing a doctor of new customers taking up a bit in recent months .

Frédéric Perron: I'll just add beyond the rate increases that we do. Obviously, a reality of our business for the past many years is that new customers come in at a lower ARPU than existing customers, but with a more rational pricing environment, we're seeing the ARPU of new customers ticking up a bit in recent months. There's also the stickiness at the end of promotions, which has the possibility to increase as customers are not presented with as aggressive offers from competition.

Frédéric Perron: I'll just add, beyond the rate increases that we do, obviously, a reality of our business for the past many years is that new customers come in at a lower ARPU than existing customers. With a more rational pricing environment is we're seeing the ARPU of new customers ticking up a bit in recent months. There's also the stickiness at the end of promotions, which has the possibility to increase as customers are not presented with as aggressive offers from competition.

Speaker #4: There's also the stickiness at the end of promotions , which has the possibility to to increase as customers are not presented with as aggressive offers from competition .

Speaker #7: Okay , I'm gonna switch to the US . You added . Correct me if I heard this right . You added 35,000 new fiber to the home passings in in just in fiscal 2025 .

[Analyst 2]: Okay, I'm going to switch to the U.S. You added, correct me if I heard this right, you added 35,000 new fiber-to-the-home passings just in fiscal 2025.

Vince Valentini: Okay. I'm gonna switch to the US. You added Correct me if I heard this right, you added 35,000 new fiber to the home passings just in fiscal 2025?

Speaker #4: The comment that I made in my section of the introduction is that we have upgraded 35,000 doors from cable to fiber.

Frédéric Perron: The comment that I made in my section of the introduction is that we have upgraded 35,000 doors from cable to fiber.

Frédéric Perron: The comment that I made in my section of the introduction is that we have upgraded 35,000 doors from cable to fiber-to-the-home.

Speaker #7: Right . So but that was that's not a total that's the incremental in in the fiscal year .

[Analyst 1]: Right.

Vince Valentini: Right. That's not a total, that's the incremental in the fiscal year.

[Analyst 2]: That's not a total. That's the incremental in the fiscal year.

Speaker #4: Correct .

Frédéric Perron: Correct.

Frédéric Perron: Correct.

Speaker #7: So two two questions on that . Can you give us any sense as to what the total fiber passings are now . And secondly , to get that extra 35,000 , was that using the new technology that you sort of talked to us out about last November ?

[Analyst 2]: Can you give us any sense as to what the total fiber passings are now? Secondly, to get that extra 35,000, was that using the new technology that you sort of talked to us about last November?

Vince Valentini: Two questions on that. Can you give us any sense as to what the total fiber passings are now? Secondly, to get that extra 35,000, was that using the new technology that you sort of talked to us about last November?

Speaker #4: The second part of the question , the answer is yes . And that's why you still see a good CapEx from us .

Frédéric Perron: The second part of the question, the answer is yes. That is why you still see good CapEx from us.

Frédéric Perron: The second part of the question, the answer is yes. That's why you still see a good CapEx from us.

Speaker #5: Yeah . And you will we'll continue this in fiscal 26 . So our program to selectively upgrade certain areas in the US with fibre to the home as it it is a good cost benefit to us with this new technology doesn't apply everywhere , but there's some areas where it does a lot of sense .

Patrice Ouimet: Yeah, and we'll continue this in fiscal 2026. Our program to selectively upgrade certain areas in the U.S. with fiber-to-the-home, as it is a good cost benefit to us with this new technology. It doesn't apply everywhere, but there are some areas where it does a lot of sense. This will continue this year and probably a little bit in fiscal 2027. We can absorb this in our CapEx envelope. Overall, to your question, we don't disclose specifically our fiber component. As you know, most of our network is fiber, but the last mile obviously is we're still predominantly on coax, and it's generally more efficient to upgrade the coax than do an overbuild as we're doing selectively in the U.S. I would say overall, between the network expansions that we're doing, those are generally in fiber-to-the-home.

Patrice Ouimet: Yeah. We'll continue this in fiscal 2026. Our program to selectively upgrade certain areas in the US with fiber to the home, as it is a good cost benefit to us with this new technology. It doesn't apply everywhere, there are some areas where it does a lot of sense. This will continue this year and probably a little bit in fiscal 2027. Again, we can absorb this in our CapEx envelope. Overall, to your question, we don't disclose specifically our fiber component. As you know, most of our network is fiber, the last mile, obviously, is, we're still predominantly on coax. It's generally more efficient to upgrade the coax than do an overbuild as we're doing selectively in the US.

Speaker #5: This will continue this year and probably a little bit in fiscal 27 . Again , we can absorb this in our CapEx envelope .

Speaker #5: Overall . To your question , we don't disclose specifically our fiber component . As you know , most of our network is fiber , but the last mile , obviously is we're still predominantly on coax and it's generally more efficient to upgrade the coax than do an Overbuild as we're doing selectively in the US .

Speaker #5: So I would say overall , between the network expansions that we're doing , those are generally in fibre to the home . We've been doing this for more than ten years , and the selective upgrades , it's still a small portion of our network that is fully fiber to the home .

Patrice Ouimet: I would say overall, between the network expansions that we're doing, those are generally in fiber to the home. We've been doing this for more than 10 years. The selective upgrades, it's still a small portion of our network that is fully fiber to the home. Again, as we upgrade coax, we're able to deliver in many regions, actually, 2 gigs even on coax by doing minor. We're not even on DOCSIS 4.0 yet, we offer 2 gigs in several regions in Canada. This, I would say the future will be a mix of fiber to the home, upgrades of coax, and there's different ways of upgrading that. Eventually, we'll have DOCSIS 4.0 as well, but we did not rush it as we're able to generally have much faster speeds than what customers want.

Patrice Ouimet: We've been doing this for more than 10 years, and the selective upgrades, it's still a small portion of our network that is fully fiber-to-the-home. As we upgrade coax, we're able to deliver in many regions actually two gigs even on coax by doing minor upgrades. We're not even on DOCSIS 4 yet, and we offer two gigs in several regions in Canada. The future will be a mix of fiber-to-the-home, upgrades of coax, and there's different ways of upgrading that. Eventually, we'll have DOCSIS 4 as well. We did not rush it as we're able to generally have much faster speeds than what customers want. The cost benefit is better for us to do it this way.

Speaker #5: But again , as we upgrade coax , we're able to deliver in many regions actually two gigs , even on coax , by doing minor , we're not even on Docsis four yet .

Speaker #5: And so we offer two gigs in several regions in Canada . So this I would say the future will be a mix of fibre to the home , upgrades of coax , and there's different ways of upgrading that .

Speaker #5: Eventually we'll have Docsis four as well , but we did not rush it as we're able to generally have much faster speeds than what customers want .

Speaker #5: So the the cost benefit is better for us to to do it this way .

Patrice Ouimet: The cost benefit is better for us to do it this way.

Speaker #7: So sorry , I'm going to ask one more on this because I don't think it's well understood by people . The the cost per home passed when you did those 35,000 .

Vince Valentini: Sorry, I'm gonna ask one more on this 'cause I don't think it's well understood by people. The cost per home passed when you did those 35,000, because of that new, more efficient technology, can you give us an update on what the average cost was per home in terms of the CapEx?

[Analyst 2]: Sorry, I'm going to ask one more on this because I don't think it's well understood by people, the cost per home passed when you did those 35,000 because of that new, more efficient technology. Can you give us an update on what the average cost was per home in terms of the CapEx?

Speaker #7: Because of that new , more efficient technology . Can you give us an update on on what the average cost was per home in terms of the CapEx ?

Speaker #5: Yeah , it varies by region , but I would say it's generally it's it's probably around $400 or so , but really there's a there's some that are less expensive than this and some more .

Patrice Ouimet: Yeah, it varies by region, but I would say it's generally, it's probably around $400 or so. There are some that are less expensive than this and some more, so it's not just one number. The more dense it is, and depending on how the structure of the network is, it is, yeah. It is fairly effective when you look at this versus doing the traditional fiber-to-the-home with the traditional method. You know the numbers for competitors. Generally, this is a lot higher. This is what we do in network expansion as well. When you look also at going through the coax route all the way to DOCSIS 4 with high splits, you can get to these numbers easily as well over time with the CPE changes. I would say that is probably a good average to use.

Patrice Ouimet: Yeah. It varies by region, but I would say it's generally, it's probably around CAD 400 or so. Really there's some that are less expensive than this and some more so. It's not just one number. The more dense it is and depending on how the structure of the network is, it is. Yeah. It is fairly effective when you look at this versus doing the traditional fiber to the home with the traditional method. You know the numbers for competitors. Generally, this is a lot higher. This is what we do in network expansions as well.

Speaker #5: So there's it's not a just a one number . And the more dense it is and depending on how the structure of the network is , it is .

Speaker #5: Yeah . So it is fairly effective when you look at this versus doing the traditional fiber to the home with the traditional method , you know , the numbers for competitors .

Speaker #5: So generally this is a lot higher . This is what we do in network expansion as well . And and when you look also at going through the coax route all the way to Docsis four with high splits , you can get to these numbers easily as well over time with the CPE changes .

Patrice Ouimet: When you look also at going through the coax route all the way to DOCSIS 4.0 with high splits, you can get to these numbers easily as well over time with the CPE changes. Yeah. That I would say is probably a good average to use.

Speaker #5: So so yeah , so that that I would say is probably a good average to use .

Speaker #7: Troy Patrice , when you we're talking about the US segment . So when you say 400 , are you talking 400 USD .

[Analyst 2]: That's Troy. Patrice, we're talking about the U.S. segment. When you say $400, are you talking U.S. $400?

Vince Valentini: Sorry, Patrice. We're talking about the US segment.

Patrice Ouimet: Yes.

Vince Valentini: When you say 400, are you talking $400?

Speaker #5: Yes it is US dollars . Yeah .

Patrice Ouimet: Yes, it is U.S. dollars.

Patrice Ouimet: Yes, it is US dollars. Yeah.

Speaker #8: Okay .

[Analyst 3]: Okay.

Vince Valentini: Okay. Last, just free cash flow. I'm sure others will ask about this too, but just in general sense, I wanna make sure I'm clear. You're guiding, excluding rural projects, you're guiding to, like, CAD 625 million to CAD 690 million of free cash flow this fiscal year, and you're saying you can only do CAD 600 million in fiscal 2027. Is that because you found new expansion projects so that that bucket of CapEx doesn't go to zero, or are you deliberately telegraphing that other items within free cash flow are gonna go negative, like whether it's EBITDA or cash taxes or interest or something else?

Speaker #7: And last just just free cash flow I'm sure others are asking about this too . But just in general sense I want to make sure I'm clear .

[Analyst 2]: Just on free cash flow, I'm sure others will ask about this too. In a general sense, I want to make sure, including your guide excluding rural projects, you're guiding to $625 million to $690 million of free cash flow this fiscal year. You're saying you can only do $600 million in fiscal 2027. Is that because you found new expansion projects so that bucket of capital expenditures doesn't go to zero, or are you deliberately telegraphing that other items within free cash flow are going to go negative, like whether it's adjusted EBITDA or cash taxes or interest or something else?

Speaker #7: You're you're excluding rural projects . You're guiding to like 625 million to 690 million of of free cash flow . This fiscal year .

Speaker #7: And you're saying you can only do 600 million in fiscal 2027 ? Is that because you found new expansion projects so that that that bucket of CapEx doesn't go to zero or are you deliberately telegraphing that other items within free cash flow are going to are going to go negative , like whether it's EBITDA or cash taxes or interest or something else ?

Speaker #5: No . The other question you could have asked is whether the 600 is actually a too low number , but I would say 600 , we think is is a good number to use .

Patrice Ouimet: No. The other question you could have asked is whether the 600 is actually too low a number. I would say 600 we think is a good number to use. Obviously, we'll see where we are a year from now when we provide guidance for fiscal 2027. That's still our plan. Right now within our expansion numbers, we have these bigger projects that are generally subsidized. There's still a lot going on in Ontario this year, which will finish in 2027. There shouldn't be that much CapEx in fiscal 2027 related to that. That being said, we are generally building in territory as well. There's always new construction, new neighborhoods, new streets. This will continue. Eventually we will not break it down as we're going to be done with the bigger projects. You'll just see one number.

Patrice Ouimet: No. Or the other question you could have asked is whether the 600 is actually a too low a number. I would say 600, we think is a good number to use. Obviously, we'll see where we are a year from now when we provide guidance for fiscal 2027, but that's still our plan right now. Within our expansion numbers, we have these bigger projects that are generally subsidized. There's still a lot going on in Ontario this year, which will finish in 2027. There shouldn't be that much CapEx in fiscal 2027 related to that. That being said, we are generally building in territory as well. There's always new construction, new neighborhoods, new streets. This will continue.

Speaker #5: Obviously , we'll see where we are here from now when we provide guidance for fiscal 27 . But that's still our plan right now within our expansion numbers , we have these bigger projects that are generally subsidized .

Speaker #5: So there's still a lot going on in Ontario this year , which will finish in 27 . There shouldn't be that much CapEx in fiscal 27 related to that .

Speaker #5: That being said , we are generally building in territory as well . So there's always new construction , new neighborhoods , new streets .

Speaker #5: So this will continue eventually . We will not break it down as we're going to be done with the bigger projects . So you'll just see one number .

Patrice Ouimet: Eventually, we will not break it down as we are going to be done with the bigger projects. You will just see one number. It will not be meaningful to split it out. I would say these will continue. Also, the other component is, as we have built in many areas and we are loading customers, we are adding CPEs for these customers, so we have to obviously invest there. Sometimes, depending on how we built the network, sometimes we had to install service lines as well, basically the drops we put from the street to the house. For some of the projects, it is pre-installed, and for some of them, it is not. It is really when customers want to connect, we pass this drop. I would say these CapEx will continue in the future.

Speaker #5: It will not be meaningful to split it out . But I would say these will continue . And also the other component is , as we've built in many areas and we're loading customers , we are adding CPE for these customers .

Patrice Ouimet: It will not be meaningful to split it out, but I would say these will continue. Also, the other component is as we've built in many areas and we're loading customers, we are adding CPEs for these customers. We have to obviously invest there. Sometimes depending on how we built the network, sometimes we have to install service lines as well. Basically the drops we put from the street to the house, for some of the projects it's pre-installed and for some of them it's not. It's really when customers want to connect, we pass this drop. I would say these CapEx will continue in the future.

Speaker #5: So we have to obviously invest there . And sometimes depending on how we build the network , sometimes we have to install service lines as well .

Speaker #5: Basically , the drops we put from the street to the house for some of the projects , it's pre-installed and for some of them it's really when customers want to connect .

Speaker #5: not . It's

Speaker #5: We pass this drop . So I would say these CapEx will continue in the future .

Speaker #4: So it's not telegraphing an EBITDA pressure or any other no pressure .

Frédéric Perron: It is not telegraphing an adjusted EBITDA pressure or any other pressure.

Frédéric Perron: It's not telegraphing an EBITDA pressure.

Patrice Ouimet: No

Frédéric Perron: pressure. Yes.

Speaker #5: Yes .

[Analyst 1]: Yes.

Speaker #7: Appreciate the color guys . Thank you .

[Analyst 2]: Appreciate the color, guys. Thank you.

Vince Valentini: Appreciate the color, guys. Thank you.

Speaker #3: Your next question comes from Jerome Debray with Desjardins . Your line is now open .

Operator: Your next question comes from Jerome Dubreuil with Desjardins. Your line is now open.

Operator: Your next question comes from Jerome Dubreuil with Desjardins. Your line is now open.

Jerome Dubreuil: Hey, bonjour, Vince. Thanks for taking my question. First one for me. I'd like you, if possible, to give a little bit more detail on the turnaround you expect on the top line, you know, where we're at mid-single-digit declines in the quarter. You're expecting an improvement if I look at the guidance. Maybe more granularity on this. Is it from wireless? Was there a top comp or maybe an assumption of improvement in competition?

Speaker #9: Thanks for taking my question . First one for me , I'd like I'd like you , if possible , to give a little bit more detail on the the turnaround .

[Analyst 4]: Thanks for taking my question. First one for me. I'd like you, if possible, to give a little bit more detail on the turnaround you expect on the top line. We're at mid single digit decline in the quarter, but you're expecting an improvement if I look at the guidance. Maybe more granularity on this. Is it from wireless? Was there a tough comp or maybe an assumption of improvement in competition?

Speaker #9: You expect on the top line . You know , where we're at mid-single digit declines in the quarter , but but your you're expecting an improvement .

Speaker #9: If I look at the guidance . So maybe more granularity on this . Is it from from

Speaker #9: there a tough comp or maybe an assumption of improvement in competition .

Speaker #5: Yes . So good morning Jerome . So you're talking about a consolidated level right ?

Patrice Ouimet: Yes. Good morning, Jerome. You're talking at a consolidated level, right?

Patrice Ouimet: Yes. Good morning, Jerome. You're talking at a consolidated level, right?

Speaker #10: Yes .

[Analyst 4]: Yes.

Jerome Dubreuil: Yes.

Speaker #5: Okay . Great . Yeah . So I would say if we look at our Canadian business , we've been adding a lot of customers , as you know , we are still planning to continue to grow the Canadian business .

Patrice Ouimet: Okay, great. Yeah. I would say if we look at our Canadian business, we've been adding a lot of customers. As you know, we are still planning to continue to grow the Canadian business. This translates into additional revenue. We have visibility on basically our current client base, customer base. We also know when we have new customers, often on promotions, some that roll off promotions as well. This is all factored in, and based on this, we'll eventually have some price increases as well. I would say the key driver in Canada is really the additional subscribers we're able to load down that we were not doing as much of, let's say, two years ago. That should produce better numbers on the top line in Canada than what we've seen in the past year. In the U.S., I would say similar story on the subscribers.

Patrice Ouimet: Okay, great. I would say if we look at our Canadian business, we've been adding a lot of customers, as you know. We are still planning to continue to grow the Canadian business. This translates into additional revenue. We have visibility on basically on our current client base, customer base. We also know when we have new customers often on promotions, some that are roll-off promotions as well. This is all factored in. Based on this, we'll eventually have some price increases as well. I would say the key driver in Canada is really the additional subscribers we're able to load on that we were not doing as much of, let's say, 2 years ago.

Speaker #5: So this translates into additional revenue . We have visibility on basically our on our current client base , customer base . We we also know when we have when we have new customers , often on promotions , some that roll off promotions as well .

Speaker #5: So this is all factored in . And based on this we'll eventually have some price increases as well . But I would say the key driver in Canada is really the additional subscribers we're able to to load on that .

Speaker #5: We were not doing as much of , let's say , two years ago and that should that should produce better numbers on the top line in Canada than what we've seen in the past year .

Patrice Ouimet: That should produce better numbers on the top line in Canada than what we've seen in the past year. In the US, I would say similar story on the subscribers. It's just that we're starting from a negative number. We do see some improvements from what we reported on in Q4, but we're already well into Q1 right now. We are seeing benefits, and we've put a lot of new tactics to play and go to market, and many of them are working well. I would say this is the key element we're seeing for next year. We're still planning to see a negative number in the US in terms of year-on-year.

Speaker #5: And in the US . I would say similar story on the subscribers . It's just that we're starting from a negative number . We do see some improvements from what we reported on in Q4 , but we're already well into Q1 right now .

Patrice Ouimet: It's just that we're starting from a negative number. We do see some improvements from what we reported on in Q4, but we're already well into Q1 right now. We are seeing benefits, and we've put a lot of new tactics to play and go to market, and many of them are working well. I would say this is the key element we're seeing for next year. We're still planning to see a negative number in the U.S. in terms of year on year. We still have video cord cutting and home phone cord cutting like the whole, but still an improvement overall.

Speaker #5: So we are seeing benefits and we've put a lot of new tactics to play and go to market . And many of them are working well .

Speaker #5: So I would say this is the the key element we're seeing for next year . We're still planning to see a negative number in the US in terms of year over year on year .

Speaker #5: We we still have video cord cutting and home phone cord cutting , like the whole industry , but still an improvement overall .

Patrice Ouimet: We still have video cord cutting and home phone cord cutting like the whole industry, but still an improvement overall.

Speaker #4: Yeah , I'll only add Jerome first on the Canadian side , we've been adding subs at a good pace for many quarters now , but the pressure in the past was our rpu and what we're seeing now with a slightly better pricing environment is we're seeing a bit of upside on Rpu .

Frédéric Perron: Yeah, I'll only add, Jerome, first on the Canadian side we've been adding subs at a good pace for many quarters now. The pressure in the past was ARPU, and what we're seeing now with a slightly better pricing environment is we're seeing a bit of upside on ARPU, as we were talking about before with VINs, the ARPU of new customers, the ARPU at promo expiry, and the possibility for rate increases. It doesn't take much of an ARPU improvement, given the strong sub loadings, to benefit the revenue overall. In the U.S., we've touched on it earlier, but we had done a materially lower rate increase over the past year, and now the elephant is going through the stake, and we expect better progression in the U.S., especially going into the second quarter.

Frédéric Perron: Yeah. I'll only add, Jerome Dubreuil. First on the Canadian side, we've been adding subs at a good pace for many quarters now, but the pressure in the past was ARPU. What we're seeing now with a slightly better pricing environment is we're seeing a bit of upside on ARPU, as we were talking about before with Vince, the ARPU of new customers, the ARPU at promo expiry, and the possibility for rate increases. It doesn't take much of an ARPU improvement given the strong sub loadings to benefit the revenue overall.

Speaker #4: As we were talking about before with with Vince , DRP of New customers , the Rpu at promo expiry and the possibility for rate increases and it doesn't take much of an rpu improvement given the the strong sub loadings to benefit the revenue overall .

Speaker #4: And then in the US , we've touched on it earlier , but we've done we had done a materially lower rate increase over the past year , and now the elephant's going through the snake and we expect better progression in the US , especially going to the second quarter .

Frédéric Perron: In the US, we've touched on it earlier, but we had done a materially lower rate increase over the past year. Now the elephant's going through the snake. We expect a better progression in the US, especially going through Q2.

Speaker #9: Okay , great . Merci . Second one for me . Just continuing on the line of question on the Docsis to to fiber , to the home upgrade coax , I should say , fiber to the home .

Jerome Dubreuil: Okay, great. Merci. Second one for me. Just continuing on the Vince's line of question on the DOCSIS to fiber to the home upgrade, the coax, I should say, to the fiber to the home. Is this something you plan to do across your whole footprint? You kind of alluded to the fact that it could be more efficient to do that than taking the DOCSIS roadmap. Is this something you really use as a tactic to maybe counter the fiber deployments?

[Analyst 4]: Great. Merci. Second one for me. Just continuing on Vince's line of question on the DOCSIS to fiber-to-the-home upgrade, the coax, I should say, to fiber-to-the-home. Is this something you plan to do across your whole footprint? You kind of alluded to the fact that it could be more efficient to do that than taking the DOCSIS roadmap. Is this something you really use as a tactic to maybe counter the fiber deployments?

Speaker #9: Is this something you you plan to do across your your whole footprint ? You kind of alluded to to the fact that it could be more efficient to do that than taking the Docsis roadmap , or is this something you're really use as a tactic to , to maybe counter the fiber deployments ?

Speaker #4: Thanks for the question , Jerome . And maybe starting at a at a higher level , when you look at our total CapEx envelope , so much of it is maintenance .

Frédéric Perron: Thanks for the question, Jerome. Maybe starting at a higher level, when you look at our total CapEx envelope, so much of it is maintenance, the majority is business as usual maintenance. When you see us reducing our CapEx, that is where the reduction in the efficiency is coming from. Our growth-related CapEx, which is everything you're talking about now, continues whether it's expanding our network to new rural areas or upgrading our network in the various ways that you're mentioning. As it relates to network upgrades, we're doing a lot of mid splits. In Canada in particular, we're really improving. It's now over 90% of our doors have a download speed of one gig and sometimes two gig. We're also really improving the upload speeds as noted by Ookla, for example.

Frédéric Perron: Thanks for the question, Jerome. Maybe starting at a, at a higher level, when you look at our total CapEx envelope, so much of it is maintenance. The majority is business as usual maintenance. When you see us reducing our CapEx, that is where the reduction and the efficiency is coming from. Our growth related CapEx, which is everything you're talking about now, continues, whether it's expanding our network to new rural areas or upgrading our network in the various ways that you're mentioning. As it relates to network upgrades, we're doing a lot of mid-splits in Canada in particular. We're really improving. It's now over 90% of our doors have a download speed of 1 gig and sometimes 2 gig. We're also really improving the upload speeds, as noted by Ookla, for example.

Speaker #4: The majority is business as usual , maintenance . So when you see us reducing our CapEx , that is where the reduction in the efficiency is coming from .

Speaker #4: Our growth related CapEx , which is everything you're talking about now continues , whether it's expanding our network to new rural areas or upgrading our network in the various ways that that you're mentioning .

Speaker #4: So as it relates to network upgrades , we're doing a lot of mid splits in Canada in particular . We're really improving . It's now over 90% of our doors have a download speed of one gig .

Speaker #4: And sometimes two gig . And we're also really improving the upload speeds . As noted by Ookla for example . And then in the US we have this capital efficient way of upgrading our coax network to fiber , for example , to 35,000 doors that we've done last year .

Frédéric Perron: In the U.S., we have this capital efficient way of upgrading our coax network to fiber, for example, the 35,000 doors that we've done last year, and our forecast for the coming year also implies that we will continue with both sets of programs that I was talking about for the U.S. and Canada. It's a mix depending on the region, mid splits, even sometimes some high splits in some regions, plus this capital efficient upgrade of coax to fiber.

Frédéric Perron: In the US, we have this capital efficient way of upgrading our coax network to fiber. For example, the 35,000 doors that we've done last year and our forecast for the coming year also implies that we will continue with both sets of programs that I was talking about for the US and Canada. It's a mix depending on the region. Mid-splits, even sometimes some high-splits in some regions, plus this capital efficient upgrade of coax to fiber. That is it.

Speaker #4: And our forecast for the coming year also implies that we will continue with both sets of programs that I was talking about for the US and Canada .

Speaker #4: So it's a mix depending on the region mid split , even sometimes some high splits in some regions . Plus this capital efficient upgrade of of Kolkata fiber .

Speaker #5: Yeah . And yeah I definitely that's the plan . And as you know us we've always over the years trying to be very capital efficient and always provide a lot more than what customers are requiring from us in terms of speeds and capacity and doing it in a capital efficient way rather than overinvesting in the network .

Patrice Ouimet: Yeah, definitely that's the plan. As you know, in the U.S., we've always over the years tried to be very capital efficient and always provide a lot more than what customers are requiring from us in terms of speeds and capacity, and doing it in a capital efficient way rather than overinvesting in the network that would not necessarily be used. It is in the U.S. More specifically to your question on competition, for sure in some regions it does help to upgrade to fiber, but obviously we only do it if it makes sense financially when you take a multi-year view of the otherwise upgrades we would need to do in these particular regions.

Patrice Ouimet: Yeah. definitely, that's the plan. as you know us, we've always over the years trying to be very capital efficient and always provide a lot more than what customers are requiring from us in terms of speeds and capacity and doing it in a capital efficient way rather than over-investing in the network that would not necessarily be used. it is. In the US, more specifically to your question on competition, for sure, in some regions, it does help to upgrade to fiber. Obviously we only do it if it makes sense financially when you take a multi-year view of the otherwise upgrades we would need to do in these particular regions.

Speaker #5: That would not necessarily be used . So it is . And in the US , more specifically to your question on competition , for sure , in some regions it does help to to upgrade to fiber .

Speaker #5: But obviously we only do it if it makes sense financially . When you take a multi-year view of the otherwise upgrades , we would need to do in these particular regions .

Speaker #4: Yeah , the our US competitive dynamics are getting predictable . Much more predictable by state , by market in terms of who's likely to do some upgrades in our competitors , who may be tempted to overbuild .

Frédéric Perron: Yeah, our U.S. competitive dynamics are getting predictable, much more predictable by state, by market in terms of who's likely to do some upgrades in our competitors who may be tempted to overbuild. We have pretty granular projections at a market-by-market level, and we're using that to inform where we will upgrade that market to fiber, for example, as a protective measure, for instance.

Frédéric Perron: Yeah, the, our US competitive dynamics are getting predictable, much more predictable by state, by market, in terms of who's likely to do some upgrades and our competitors who may be tempted to overbuild. We have pretty granular projections, at a market-by-market level, and we're using that to inform where we will upgrade that market to fiber, for example, as a protective measure, for instance.

Speaker #4: So we we have pretty granular projections at a market by market level , and we're using that to inform where we will upgrade that market to fiber .

Speaker #4: For example , a protective measure , for instance .

Patrice Ouimet: That's super cool.

Speaker #3: Your next question comes from Matthew Griffith with Bank of America. Your line is now open.

Operator: Your next question comes from Matthew Griffith with Bank of America. Your line is now open.

Operator: Your next question comes from Matthew Griffiths with Bank of America. Your line is now open.

Speaker #11: Hi . Hi . Good morning . Thanks for taking the questions . So in the second year of your transformation program , I think you've mentioned that you're going to see some more investments to sustain or to , you know , move you towards a path to sustainable growth .

[Analyst 1]: Hi, good morning. Thanks for taking the questions. In the second year of your transformation program, I think you've mentioned that you're going to see some more investments to sustain or to move you towards a path to sustainable growth. Not to be too nitpicky or anything, is that growth at the revenue level or are you talking growth on free cash flow level? Maybe you can elaborate on the investment. What are you spending money on that you think is going to generate the growth, the sustainable growth going forward? When do you expect that to materialize? If it's top line, if it's obviously free cash flow, it's somewhat baked in already.

Matthew Griffiths: Hi. Good morning. Thanks for taking the question. In the second year of your transformation program, I think you've mentioned that you're gonna see some more investments to sustain or to, you know, move you towards a path to sustainable growth. You know, not to be too nitpicky or anything, but is that growth like at the revenue level, or are you talking growth on a free cash flow level? Maybe you can elaborate on, like, the investment. Like, what are you spending money on that you think is going to, you know, generate the growth, the sustainable growth going forward, and when will that and when do you expect that to materialize if it's top line? If it's obviously free cash flow, it's somewhat baked in already.

Speaker #11: And , you know , not to be too nitpicky or anything , but is that growth like at the revenue level or are you talking growth on a free cash flow level ?

Speaker #11: And maybe you can elaborate on , like the investments like what ? What are you spending money on that you think is going to generate the growth ?

Speaker #11: The sustainable growth going forward ? And when will that kind of when do you expect that to materialize ? If it's top line , if it's obviously free cash flow , it's somewhat baked in already .

Speaker #4: Yeah . Hi , Matt , it's Fred . I'll start with the last part of the question . Whatever investments we're making , we're making are fully baked in to our guidance .

Frédéric Perron: Yeah, hi Matt, it's Fred. I'll start with the last part of the question. Whatever investments we're making are fully baked into our guidance. There are many things we do that are not so material at the EBITDA or CapEx level. We've already talked a lot about our CapEx investments in upgrading our networks, so I'm not going to repeat that. At the EBITDA level, a lot of what we're doing is not material. Investments in AI analytics pricing are not that expensive. The two that are material are growing certain sales channels in the U.S., which were underdeveloped. You do need to make an investment in staff and commissions on things like that, as well as wireless in Canada. Again, that's baked into the guidance for the coming year as it relates to which growth we want. Certainly, we've already been delivering a growth in subs in Canada.

Frédéric Perron: Yeah. Hi, Matthew Griffiths, it's Frédéric Perron. I'll start with the last part of the question. Whatever investments we're making are fully baked in to our guidance. There are many things we do that are not so material at the EBITDA or CapEx level. Well, we've already talked a lot about our CapEx investments anyways in upgrading our networks, I'm not gonna repeat that. At the EBITDA level, a lot of what we're doing is not material. Investments in AI analytics, pricing are not that expensive. The two that are material are growing certain sales channels in the US, which were underdeveloped. You do need to make an investment in staff and commissions on things like that, as well as wireless in Canada.

Speaker #4: There are many things we do that are not so material at the radar or CapEx level . Well , we've already talked a lot about our CapEx investments anyways .

Speaker #4: In upgrading our networks . So I'm not going to repeat that . But at the EBITDA level , a lot of what we're doing is not material investments in AI , analytics .

Speaker #4: Pricing are not that expensive . The two that are material are growing certain sales channels in the US , which were underdeveloped . You do need to make an investment in staff and commissions on things like that , as well as wireless in Canada .

Speaker #4: But again , that's baked into the guidance for the coming year as it relates to which growth we want . Certainly , we've already been delivering a growth in subs in Canada .

Frédéric Perron: Again, that's baked into the guidance for the coming year. As it relates to which growth we want, certainly we've already been delivering a growth in subs in Canada. We think ARPU has better upside than in the past. Therefore, I think revenue growth in Canada, and I'm not gonna give a super precise time period here, but revenue growth in Canada is certainly within reach. In the US, it's about continuing our stabilization of our sub-losses. We think that continued sub growth in Ohio is realistic. As it relates to the rest of the footprint, we're on track to diminishing those losses, and we expect lower losses in the next quarter as well. Overall, in terms of top line for the US, we'll have to see.

Speaker #4: We think our has better upside than in the past . So therefore I think revenue growth in Canada and I'm not going to give a super precise time period here .

Frédéric Perron: We think ARPU has better upside than in the past. Therefore, I think revenue growth in Canada, and I'm not going to give a super precise time period here, but revenue growth in Canada is certainly within reach. In the U.S., it's about continuing our stabilization of our sub losses. We think that continued sub growth in Ohio is realistic as it relates to the rest of the footprint. We're on track to diminishing those losses, and we expect lower losses in the next couple weeks of the quarter as well. Overall, in terms of top line for the U.S., we'll have to see. It remains a challenging market, but we certainly don't expect the same challenging top line performance as what we've seen in the past year.

Speaker #4: revenue growth in Canada is certainly within reach in the US . It's about continuing our stabilization of our sub losses . We think that continued sub growth in Ohio is realistic as it relates to the rest of the footprint .

Speaker #4: We're on track to diminishing But those losses , and we expect lower losses in the next quarter as well . Overall , in terms of top line for the US , we'll have to see it remains a challenging market , but we certainly don't expect the same challenging top line performance as what we've seen in the past year .

Frédéric Perron: It remains a challenging market, but we certainly don't expect the same challenging top line performance as what we've seen in the past year.

Speaker #11: Okay , that's helpful . And then on margins , obviously the business is benefiting from the natural mix shift away from video . And so on and towards internet .

[Analyst 1]: Okay, that's helpful. On margins, obviously the business is benefiting from the natural mix shift away from video and towards Internet. Can you help us understand how much your cost reduction program is contributing to the margin improvement in addition to the natural mix shift that you're seeing?

Matthew Griffiths: Okay, that's helpful. Then on margins, you know, obviously the business is benefiting from the natural mix shift away from video and so on and towards internet. Can you help us understand, like, how much your cost reduction program is contributing to the margin improvement in addition to the natural mix shift that you're seeing?

Speaker #11: But can you help us understand how much your cost reduction program is contributing to the margin improvement ? In addition to the natural mix shift that you're you're seeing ?

Speaker #5: Yeah , it's a good question . I'm not sure I have the exact answer for you right now in this call , but I would say it's a mix of two .

Patrice Ouimet: Yeah, it's a good question. I'm not sure I have the exact answer for you right now on this call, I would say it's a mix of two. You're right, there is a mix shift towards more internet, which does increase the percentage. As we look at the competitive nature of the industry, there's also the ARPU that plays into it. I would say the best way to look at it is to look at our OpEx. That does include some video costs in what we report publicly, you can see that it's been shrinking.

Patrice Ouimet: Yeah, it's a good question. I'm not sure I have the exact answer for you right now on this call, but I would say it's a mix of two. You're right. There is a mix shift towards more Internet, which does increase the % as we look at the competitive nature of the industry. There's also the ARPU that plays into it. I would say the best way to look at it is to look at our OpEx that does include some video costs in what we report publicly, but you can see that it's been shrinking. We can perhaps take it offline and try to give you a little more information on this. I would say it's really a mix of the two because our cost reductions are quite material actually in what we've been doing in the past year.

Speaker #5: You're right . There is a mix shift towards more internet , which does increase the the the percentage as as we look at the competitive nature of the industry , there's also the output that plays into it .

Speaker #5: And so, I would say the best way to look at it is to consider our operating expenses (opex), which do include some video costs in what we report publicly.

Speaker #5: But you can see that it's been shrinking . We can perhaps take it offline and try to give you a little more information on this , but I would say it's a it's really a mix of the two because our cost reductions are quite material actually , in what we've been doing in the past year .

Patrice Ouimet: We can perhaps take it offline and try to give you a little more information on this, but I would say it's really a mix of the two, 'cause our cost reductions are quite material, actually, in what we've been doing in the past year.

Speaker #11: Okay . That'd be helpful . And then maybe just one quick one , if I could sneak it in in the past , you've talked about evaluating whether or not it makes sense to kind of divest some small systems throughout your US footprint .

[Analyst 1]: Okay, that'd be helpful. Maybe just one quick one if I could sneak it in. In the past you've talked about evaluating whether or not it makes sense to kind of divest some small systems throughout your U.S. footprint. Has that file been closed at this stage, or is that still something that is potentially out there?

Matthew Griffiths: Okay. That'd be helpful. Maybe just one quick one, if I could sneak it in. In the past, you've talked about evaluating whether or not it makes sense to kind of divest some small systems throughout your US footprint. Has that file been closed at this stage, or is that still something that is potentially out there?

Speaker #11: Has that file been closed at this stage , or is that still something that is potentially out there ?

Speaker #4: Yeah . Matt , at present time it's closed . The we've looked at a few options . That were interesting possibilities , but not interesting enough .

Frédéric Perron: Yeah, Matt, at present time it's closed. We've looked at a few options. There were interesting possibilities, but not interesting enough. We judged at the time to strip out an asset because carve outs are always challenging and could be a distraction for the organization in the midst of a big transformation. Who knows? We always keep options open in the future.

Frédéric Perron: Yeah, Matt, it's closed. We've looked at a few options. There were interesting possibilities, but not interesting enough, we judged, at the time to strip out an asset because carve-outs are always challenging and could be a distraction for the organization in the midst of a big transformation. Who knows? We always keep options open in the future.

Speaker #4: We judged at the time to to strip out an asset because carve outs are always challenging and could be a distraction for the organization in the midst of a big transformation .

Speaker #4: But who knows ? We always keep options open in the future .

Speaker #11: Okay , great . Thanks a lot for the answers . I appreciate it .

Matthew Griffiths: Okay. Thanks a lot for the answers. I appreciate it.

[Analyst 1]: Thanks a lot for the answers. I appreciate it.

Speaker #4: Thank you .

Frédéric Perron: Thank you.

Frédéric Perron: Thank you.

Speaker #3: Your next question comes from Mary with Scotiabank . Your line is now open .

Operator: Your next question comes from Maher Yaghi with Scotia Bank. Your line is now open.

Operator: Your next question comes from Maher Yaghi with Scotiabank.

Maher Yaghi: I just wanted to maybe just dial on the homes passed increase in Canada. I mean, in the last two years, you've added approximately 70,000, 75,000 new homes passed. A lot of it is fiber, as I understand it. Can you know, just give us a perspective on the strength that you're seeing in your internet subscriber gains in Canada? How much they're coming from these fiber edge outs and new homes passed versus OXIO versus Cogeco out of territory, just to understand maybe the return characteristics of these fiber rollouts that you're doing. Thank you.

[Analyst 3]: Merci. I just wanted to maybe just dial on the homes passed increase in Canada. I mean in the last two years you've added approximately 70,000, 75,000 new homes passed. A lot of it is fiber as I understand it. Can you just give us a perspective on the strength that you're seeing in your Internet subscriber gains in Canada, how much they're coming from these fiber edge outs and new homes passed versus Oxio versus Cogeco out of territory? Just to understand maybe the return characteristics of these fiber rollouts that you're doing. Thank you.

Speaker #12: Question . I just wanted to maybe just dial on on home passed increase in Canada . I mean , in the last two years , you've added approximately 70 , 75,000 new homes passed .

Speaker #12: So and a lot of it is fiber , as I understand it . So can you , you know , just give us an perspective on the strength that you're seeing in your internet subscriber gains in Canada , how much they're coming from these fiber edge outs and new homes passed versus axial versus Cogeco out of territory .

Speaker #12: Just to understand , maybe the return characteristics of these fiber rollouts that you're doing . Thank you .

Speaker #4: Hi . My it's Fred a few things here . First off yes I'll most expansions that we do in both Canada and the US are on fiber as it relates to the return on those investments .

Frédéric Perron: Hi, my heart, it's Fred. A few things here. First off, yes, most expansions that we do in both Canada and the U.S. are on fiber. As it relates to the return on those investments, they're quite good, in line with what Patrice has quoted in the past. We do exceed 50% penetration of those new builds because they're rural areas with high demand. As it relates to contribution to our net growth, it varies quarter by quarter between network expansion, Oxio, and the legacy business. All I can say is that for this past Q4, it was mostly, first of all, it was mostly on our own network and less as a reseller that the growth came from. It was actually mostly from legacy areas. In the fourth quarter, network expansion was not the largest contributor to the growth.

Frédéric Perron: Hi, Maher. It's Fred. A few things here. First off, yes, all most expansions that we do in both Canada and the US are on fiber. As it relates to the return on those investments, they're quite good, in line with what Patrice has quoted in the past. We do exceed 50% penetration of those new builds because they're rural areas with high demand. As it relates to contribution to our net growth, it varies quarter by quarter between network expansion, OXIO and the legacy business. All I can say is that for this past Q4, First of all, it was mostly on our own network and less as a reseller that the growth came from, and it was actually mostly from legacy areas.

Speaker #4: They're quite good . In line with what Patrice has quoted in the past , and we do exceed 50% penetration of those new builds because they're rural areas with high demand as it relates to contribution to to our net growth .

Speaker #4: It varies quarter by quarter between network expansion and the legacy business . All I can say is that for this past Q4 , it was mostly , first of all , it was mostly on our own network and less as a reseller that the growth came from .

Speaker #4: And it was actually mostly from legacy areas . So in the fourth quarter , network expansion was not the largest contributor to the growth .

Frédéric Perron: In Q4, network expansion was not the largest contributor to the growth. Now, as we continue to build in Ontario in fiscal 2026 and going into fiscal 2027 as well, we do expect that network expansion will be a more material contributor to our sub growth.

Speaker #4: Now , as we continue to build in Ontario in fiscal 26 and going into fiscal 27 , as well , we do expect that network expansion expansion will be a more material contributor to our growth .

Frédéric Perron: As we continue to build in Ontario in fiscal 2026 and going into fiscal 2027 as well, we do expect that network expansion will be a more material contributor to our sub growth.

Speaker #12: Okay . Thank you . And just to follow up , you know , the launch of Cogeco service under the Cogeco brand , outside of your home territory .

[Analyst 3]: Okay, thank you. Just to follow up, you know, the launch of Cogeco service under the Cogeco brand outside of your home territory, Oxio was, as you've indicated in the past, has been good success to capture out of market Internet subscribers. Maybe can you talk a little bit about the objective of launching Cogeco branded service outside of your home territory in addition to Oxio that was already there?

Maher Yaghi: Okay. Thank you. Just to follow up, you know, the launch of Cogeco service under the Cogeco brand outside of your home territory, I you know, OXIO was as you know, as you indicated in the past, has been a, you know, good success to capture out-of-market internet subscribers. Maybe can you talk a little bit about the objective of launching Cogeco-branded service outside of your home territory in addition to OXIO that was already there?

Speaker #12: I , I , you know , was was was , as you know , as you've indicated in the past has been , you know , good success to capture out internet subscribers .

Speaker #12: So maybe can you talk a little bit about the objective of launching Cogeco branded service outside of your home territory ? In addition to oxygen that was already there ?

Speaker #4: Sure . First at a at a higher level , internet resale in Canada between the different players is a fact of life , and it's been a fact of life for quite some time .

Frédéric Perron: Sure. First, at a higher level, internet resale in Canada, between the different players is a fact of life. It's been a fact of life for quite some time. The two of the big three that we don't already compete with on an infrastructure basis are already reselling our network in Quebec and Ontario and have been doing so for quite some time. I wouldn't say it doesn't appear to be material, neither for our growth as a reseller nor for our churn at present time. There seems to be more noise than anything else around all this. On your question more specifically, our strategic intent by opening up Cogeco as a reseller across Quebec is purely optionality.

Frédéric Perron: Sure. First, at a higher level, Internet resale in Canada between the different players is a fact of life, and it's been a fact of life for quite some time. The two of the big three that we don't already compete with on an infrastructure basis are already reselling our network in Quebec and Ontario and have been doing so for quite some time. I wouldn't say it doesn't appear to be material, neither for our growth as a reseller nor for our churn at present time. There seems to be more noise than anything else around all this on your question. More specifically, our strategic intent by opening up Cogeco as a reseller across Quebec is purely optionality in a world where the resale dynamics continue to evolve.

Speaker #4: The two of the big three that we can , that we don't already compete with on an infrastructure basis are already reselling our network in Quebec and Ontario and have been doing so for for quite some time .

Speaker #4: I would say it doesn't appear to be material , neither for our growth as a reseller nor for our churn at present time .

Speaker #4: So there seems to be more noise than anything else around all this on your question , more specifically , our strategic intent by opening up Cogeco as a reseller across Quebec is purely optionality in a world where the resale dynamics continue to evolve .

Frédéric Perron: In a world where the resale dynamics continue to evolve, as I said, they're not material at present time, but we have nothing to lose from opening up another few million doors on the Cogeco brand. We, as a smaller company, we benefit from asymmetry in this whole game, whereby we just cover 2 million homes in Canada, and there are 15 million homes, so we get an asymmetric advantage. So far it's not much more than optionality. However, if for whatever reason, we decide to push harder on this, now the systems are activated, and it's pretty quick for us to push harder.

Speaker #4: As I said , they're not material at present time , but we have nothing to lose from opening up another few million doors on the Cogeco brand .

Frédéric Perron: As I said, they're not material at present time, but we have nothing to lose from opening up another few million doors on the Cogeco brand. We, as a smaller company, benefit from asymmetry in this whole game whereby we just covered 2 million homes in Canada and there are 15 million homes. We get an asymmetric advantage. So far it's not much more than optionality. However, if for whatever reason we decide to push harder on this now, the systems are activated and it's pretty quick for us to push harder.

Speaker #4: We, as a smaller company, benefit from asymmetry in this whole game, whereby we just cover 2 million homes in Canada and there are 15 million homes.

Speaker #4: So we get an asymmetric advantage . But so far it's not much more than optionality . However , if for whatever reason , we decide to push harder on this now , the systems are activated and it's pretty quick for us to push harder .

Speaker #12: Okay . Can you disclose how many you mentioned that ? You know , you saw some good success with wireless , with the wireless launch in Canada .

[Analyst 3]: Okay, can you disclose how many? You mentioned that you saw some good success with wireless, with the wireless launch in Canada. Can you share some KPIs on that?

Maher Yaghi: Okay. You mentioned that, you know, you saw some good success with wireless, with the wireless launch in Canada. Can you share some KPIs on that?

Speaker #12: Can you share some some some KPIs on that ?

Speaker #5: Yeah . So there we are not disclosing it at this point . As you know , we're starting from from nothing . So it's it's still a small base .

Patrice Ouimet: Yeah. Mayor, we are not disclosing yet at this point. As you know, we're starting from nothing, so it's still a small base. Very happy with so far. It takes time to have critical mass. Over time, we do expect at one point to disclose the mobile subs, but it's not something we're planning to do for sure this year and we'll see in the future. It's obviously important to make sure we don't release non-material information that can be used by competition. That's where we are at this point.

Patrice Ouimet: Yeah. Maher, we are not disclosing it at this point. As you know, we're starting from nothing. It's still a small base. Very happy with so far, but I mean, it takes time to have critical mass. Over time, we do expect at one point to disclose the mobile subs, but it's not something we're planning to do for sure this year, and we'll see in the future. It's obviously important to make sure we don't release non-material information that can be used by competition. That's where we are at this point.

Speaker #5: Very happy with so far . But I mean it takes time to have critical mass . So over time we do expect that one point to disclose the the mobile subs .

Speaker #5: But it's not something we're planning to do for sure this year . And we'll see in the future . It's obviously important to make sure we don't release non-material information that can have can be used by competition .

Speaker #5: So , so that's where we are at this point .

Speaker #4: Yeah . Only say that the strong demand that we're getting , even though it's still going to take time to scale , to Patricia's point , at least it indicating to us that there's a way for us to run that business without it being a drag at an individual customer level .

Frédéric Perron: Yeah, I'll only say that the strong demand that we're getting, even though it's still going to take time to scale to Patrice's point at least, is indicating to us that there's a way for us to run that business without it being a drag at an individual customer level. For example, we could already pull back on some of our intro promotions. I think at a unitary customer level, it's good news.

Frédéric Perron: Yeah, I'll only say that the strong demand that we're getting, even though it's still gonna take time to scale, to Patrice's point, at least it is indicating to us that there's a way for us to run that business without it being a drag at an individual customer level. For example, we could always already pull back on some of our intro promotions. I think at a unitary customer level, it is good news.

Speaker #4: For example , we could always already pull back on some of our intro promotions . So I think at a unitary customer level , it's it's a good news .

Speaker #12: Okay . And maybe just on to to double down on on this , you know the pullback on on the promotion . It kind of you know came at the same time as Rogers launched fixed wireless in your territory .

Operator: Okay.

Maher Yaghi: Okay. Maybe just to double down on this, you know, the pull back on the promotion. It kind of, you know, came at the same time as Rogers launched fixed wireless in your territory. Were the two related why you pulled back on wireless promotion?

[Analyst 3]: Maybe just to double down on this question, the pullback on the promotion kind of came at the same time as Rogers launched fixed wireless in your territory. Were the two related, why you pulled back on wireless promotion?

Speaker #12: Was that were the two related . Why you pulled back on wireless promotion .

Speaker #4: Absolutely not . We we achieved a sub objectives that that we wanted to achieve . And that's that's how we run the business .

Frédéric Perron: Absolutely not. We achieved the sub objectives that we wanted to achieve, and that's how we run the business.

Frédéric Perron: No. Absolutely not.

Maher Yaghi: Okay.

Frédéric Perron: We achieved the sub objectives that we wanted to achieve and that's how we run the business.

Speaker #12: So I'm trying to square the decision to pull back from offering , you know , one year service on wireless as a promotion to existing customers in Canada with the US strategy where it's still going on and it's been , you know , a year or so less than maybe a year that you launched it , you're still offering free lines .

[Analyst 3]: I'm trying to square the decision to pull back from offering, you know, one year service on wireless as a promotion to existing customers in Canada with the U.S. strategy where it's still going on and it's been, you know, a year or so, less than maybe a year that you launched it, you're still offering free lines. Can you maybe just compare for us why it's not, you know, it's still going on in the U.S. and not in Canada?

Maher Yaghi: I'm trying to square the decision to pull back from offering, you know, 1-year service on wireless as a promotion to existing customers in Canada with the US strategy where it's still going on, and it's been, you know, 1 year or so, less than maybe 1 year that you launched it. You're still offering free lines. Can you maybe just compare for us why it's not You know, it's still going on in the US and not in Canada?

Speaker #12: So can you maybe just compare for us ? Why it's not , you know , it's still going on in the US and and not in Canada .

Speaker #4: I it's purely a function of a competitive dynamics and pricing dynamics in the market . Maher the other players are doing it too .

Frédéric Perron: It's purely a function of competitive dynamics and pricing dynamics in the market, Maher. The other players are doing it too, in the US, the other cable players in particular. That's what we have to do to be in the game at present time south of the border.

Frédéric Perron: It's purely a function of competitive dynamics and pricing dynamics in the market. Maher, the other players are doing it too in the U.S., the other cable players in particular. That's what we have to do to be in the game at present time south of the border.

Speaker #4: In the US , the other cable players in particular . So that's that's what we have to do to be in the game at present time .

Speaker #4: South of the border .

Speaker #12: Okay . Thank you very much .

Maher Yaghi: Okay. Thank you very much.

[Analyst 3]: Okay, thank you very much.

Speaker #4: Thanks .

Frédéric Perron: Thanks.

Frédéric Perron: Thanks.

Speaker #3: Your next question comes from Stephanie Price with CIBC . Your line is now open .

Operator: Your next question comes from Stephanie Price with CIBC. Your line is now open. Hi there, it's Sam Schmidt on for Stephanie Price. I wanted to ask a question around Ohio. The net additions turned positive in the quarter, and U.S. subscriber losses also improved sequentially. Can you help unpack what changed there in terms of your strategy as well as in the competitive environment both for Ohio and the U.S. more broadly? Thanks.

Operator: Your next question comes from Stephanie Price with CIBC.

Speaker #13: Hi there . It's Sam Schmidt on for Stephanie Price . I wanted to ask a question around Ohio . The net additions turned positive in the quarter and US subscriber losses also improved sequentially .

Sam Schmidt: Hi there. It's Sam Schmidt on for Stephanie Price. I wanted to ask a question around OXIO. The net additions turned positive in the quarter, and US subscriber losses also improved sequentially. Can you help unpack what changed there in terms of your strategy as well as in the competitive environment, both for OXIO and the US more broadly? Thanks.

Speaker #13: Can you help unpack what changed there in terms of your strategy as well as in the competitive environment , both for Ohio and the US ?

Speaker #13: More broadly ? Thanks .

Speaker #4: Sure . Good to meet you . I'll start with Ohio and then I'll talk about us competitive dynamics more broadly in Ohio . Ohio is and I think we've disclosed this percentage of our doors coming from Ohio .

Frédéric Perron: Sure. Good to meet you. I'll start with Ohio and then I'll talk about U.S. competitive dynamics more broadly. In Ohio, Ohio is, and I think we've disclosed this, % of our doors coming from Ohio. It's roughly 40% of our total U.S. doors that are in Ohio and our penetration is quite low. It's been some time where we see a lot of upside for us in that market and we're starting to execute against that upside. There were some sales channels which were not as developed in the state. We're starting to develop the channels. We keep optimizing our pricing as well. Over time we think there are several quarters of growth in Ohio for us as we get closer over the years to what we believe is our fair share. U.S. competitive dynamics in general.

Frédéric Perron: Sure. Good to meet you. I'll start with Ohio, and then I'll talk about US competitive dynamics more broadly. In Ohio is, and I think we've disclosed this percentage of our doors coming from Ohio. It's roughly 40% of our total US doors that are in Ohio, and our penetration is quite low. So it's been some time where we see a lot of upside for us in that market, and we're starting to execute against that upside. There were some sales channels which were not as developed in the state, so we're starting to develop the channels. We keep optimizing our pricing as well.

Speaker #4: It's roughly 40% of our total US doors that are in Ohio . And our penetration is quite low . So it's been some time where we see a lot of upside for us in that market .

Speaker #4: And we're starting to execute against that upside . So there were some sales channels which were not as developed in the states . So we're starting to develop the channels we keep optimizing our pricing as well .

Speaker #4: And over time we think there are several quarters of growth in Ohio for us . As we get closer over the years to what we believe is our fair share .

Frédéric Perron: Over time, we think there are several quarters of growth in OXIO for us as we get closer over the years to what we believe is our, is our fair share. The US competitive dynamics in general. Last quarter, we said that we saw an uptick in competitive dynamics or competitive intensity in the US in three of our states. I would say at present time, it's more two of those states. One of the three has eased back down. Of the two that remain, we have room to believe that one will ease back down of those two as well over the coming months. We also see, interestingly, that FWA is not impacting us as a company as much as it was two, three years ago.

Speaker #4: Us competitive dynamics in general . Last quarter , we said that we saw an uptick in competitive dynamics or competitive intensity in the US in three of our states .

Frédéric Perron: Last quarter we said that we saw an uptick in competitive dynamics or competitive intensity in the U.S. in three of our states. At present time, it's more two of those states; one of them, one of the three, has eased back down. Of the two that remain, we have room to believe that one will ease back down of those two as well over the coming months. We also see, interestingly, that FWA is not impacting us as a company as much as it was two, three years ago. We rigorously track churn destination of our customers leaving us by state, and FWA is actually relatively low down the list at this time. You could only speculate why that is. We do know that some of the FWA players are now focusing more on the B2B segment where we're not as present.

Speaker #4: I would say our present time at present time is more two of those states , one of them , one of the three , has eased back down .

Speaker #4: Of the two that remain, we have room to believe that one will ease back down. Of those two as well.

Speaker #4: Over the coming months, we also see, interestingly, that FWA is not impacting us as a company as much as it was 2 or 3 years ago.

Speaker #4: We rigorously track churn destination of our customers , leaving us by state . And is actually relatively low down the list at this time .

Frédéric Perron: We rigorously track churn destination of our customers leaving us by state, and FWA is actually relatively low down the list at this time. You could only speculate why that is. We do know that some of the FWA players are now focusing more on the B2B segment, where we're not as present. Even though two of the three FWA players are reaccelerating their sales, sometimes it's in the B2B segment. Otherwise, maybe they've tapped out in their relevant customer segments in our markets. Not exactly sure, but the bottom line is FWA is not impacting us as much as before. We still see intense promotions more generally from some of the national wireline players.

Speaker #4: You could only speculate why that is . We do know that some of the players are now focusing more on the B2B segment where we're we're not as present .

Speaker #4: So even though two of the three FWA players are . Accelerating their sales , sometimes it's in the B2B segment . Otherwise maybe they've tapped out in their relevant customer segments .

Frédéric Perron: Even though two of the three FWA players are reaccelerating their sales, sometimes it's in the B2B segment. Otherwise, maybe they've tapped out in their relevant customer segments in our markets. Not exactly sure. The bottom line is FWA is not impacting us as much as before. We still see intense promotions more generally from some of the national wireline players. You net all of that out. I'd say the U.S. competitive environment remains intense but has not worsened from the previous quarter, and there may be some slight improvement coming over the next couple of quarters yet to be seen.

Speaker #4: In our markets , not exactly sure , but the bottom line is FWA is not impacting us as much as before . We still see intense promotions , more generally from some of the national wireline players .

Speaker #4: So you get all of that out . You would I'd say the US competitive environment remains intense but has not worsened from the previous quarter , and there may be some slight improvement coming over the next couple of quarters .

Frédéric Perron: You net all of that out, you would I'd say, the US competitive environment remains intense but has not worsened from the previous quarter, and there may be some slight improvement coming over the next couple of quarters. Yet to be seen.

Speaker #4: Yet to be seen .

Speaker #13: Thank you . That's helpful . And then maybe just one on the Canadian competitive market outside of your network expansion . Are you seeing increased competition from competitors as they look to build out a footprint through Tpia or fixed wireless , and then I'll pass the line .

Sam Schmidt: Thank you. That's helpful. Maybe just one on the Canadian competitive market, outside of your network expansion, are you seeing increased competition from competitors as they look to build out a footprint through TPIA or fixed wireless? I'll pass the line. Thank you.

Operator: Thank you. That's helpful. Maybe just one. On the Canadian competitive market, outside of your network expansion, are you seeing increased competition from competitors as they look to build out a footprint through TPIA or fixed wireless? I'll pass the line. Thank you.

Speaker #13: Thank you .

Speaker #4: Thank you . It's really not very material for us neither Tpia nor in Canada . As I mentioned in an earlier question , Tpia competition has been happening for a long time , and it's not really impacting us .

Frédéric Perron: Thank you. It's really not very material for us. Neither TPIA nor FWA in Canada. As I mentioned in an earlier question, TPIA competition has been happening for a long time and it's not really impacting us. FWA is more recent, but it tends to be focused in Quebec, which is one third of our Canadian footprint. We're not really feeling it, as you can see in our strong sub results in Canada. On the positive side, there's been a real material pullback in promotional activity in the core wireline business that more than offsets in a positive way the minor noise that we see in TPIA and FWA.

Frédéric Perron: Thank you. It's really not very material for us, neither TPIA nor FWA in Canada. As I mentioned in an earlier question, TPIA competition has been happening for a long time, and it's not really impacting us. FWA is more recent, but it tends to be focused in Quebec, which is one third of our Canadian footprint, and we're not really feeling it, as you can see in our strong sub results in Canada. On the positive side, there's been a real material pullback in promotional activity in the core wireline business that more than offsets in a positive way the minor noise that we see in TPIA and FWA.

Speaker #4: F.w.a is more recent , but it tends to be focused in Quebec , which is 111 third of our Canadian footprint . And we're not really feeling it .

Speaker #4: As you can see in our in our strong results in Canada . And then on the positive side , there's been a real material pullback in promotional activity in the core wireline business that that more than offsets in a positive way .

Speaker #4: The minor noise that we see in Tpia in FWA .

Speaker #13: Great . Thank you very much .

Operator: Great. Thank you very much. Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Drew McReynolds with RBC. Your line is now open.

Sam Schmidt: Great. Thank you very much.

Speaker #3: Ladies and gentlemen , as a reminder , should you have a question , please press star one . Your next question comes from drew McReynolds with RBC .

Operator: Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Drew McReynolds with RBC.

Speaker #3: Your line is now open.

Speaker #14: Yeah . Thanks very much . Good morning to for me maybe for you Patrice , in terms of the reinvestment levels that you make in the business as part of the transformation program embedded into fiscal 2026 guidance .

[Analyst]: Yeah, thanks very much. Good morning. Two for me, maybe for you, Patrice. In terms of the reinvestment levels that you make in the business as part of the transformation program embedded into fiscal 2026 guidance, do your reinvestments in the business stay stable? Are you absorbing a sequential increase? Or likewise, does the reinvestment level begin to ease as part of the transformation program going forward? Secondly, I think there's some language about $100 million in CapEx spent on longer term growth opportunities over five years just at a high level. What kind of growth opportunities you'd be looking to take advantage of with that level of investment? Thank you.

Drew McReynolds: Thanks very much. Good morning. Two for me. Maybe for you, Patrice, in terms of the reinvestment levels that you make in the business as part of the transformation program, embedded into fiscal 2020 to 2026 guidance, you know, do your reinvestments in the business stay stable? Are you absorbing a sequential increase, or likewise, does the reinvestment level begin to ease as part of the transformation program going forward? Secondly, I think there's some language about CAD 100 million in CapEx spent on longer term growth opportunities over five years. Just wondering at a high level what kind of growth opportunities, you know, you'd be looking to take advantage of with that level of investment. Thank you.

Speaker #14: You know , do your reinvestments in the business , stay stable . Are you absorbing a sequential increase or likewise , does the reinvestment level begin to ease as part of the transformation program going forward ?

Speaker #14: And then secondly , I think there's some language about 100 million in CapEx spent on longer term growth opportunities over five years . Just just wondering at a high level , what kind of growth opportunities , you know , you'd be looking to to take advantage of with that , that level of investment .

Speaker #14: Thank you .

Speaker #5: Greg . Good morning . So on the transformation program , I would say when we look at better utilizing different go to market tactics and optimizing our sales channels , we are increasing .

Patrice Ouimet: Great. Good morning. On the transformation program, I would say when we look at better utilizing different go-to-market tactics and optimizing our sales channels, we are increasing, and that's embedded in our guidance, we are increasing the use of those channels. Obviously, there are costs related to that, and that translates into new customers and new revenue. We'll see going forward as we're successful with it. The payback on these investments is very good. You have to look at the lifetime of a customer, but so far from what we're seeing, they're good. I would say we've allocated some dollars in our guidance for this.

Patrice Ouimet: Great. Good morning. On the transformation program, I would say when we look at better utilizing different go-to-market tactics and optimizing our sales channels, we are increasing, and that's embedded in our guidance. We are increasing the use of those channels. Obviously, there's costs related to that. Obviously, that translates into new customers and new revenue. We'll see going forward as we're successful with it. Obviously, the payback on these investments is very good. You have to look at the lifetime of a customer. So far from what we're seeing, they're good. I would say, we've allocated some dollars in our guidance for this.

Speaker #5: And that's embedded in our in our guidance . We are increasing the use of those channels . Obviously there's costs related to that .

Speaker #5: And obviously that translates into new customers and new revenue . We'll see going forward as we're successful with it . Obviously , the payback on these investments is very good .

Speaker #5: You have to look at the lifetime of a customer , but so far from what we're seeing , they're good . But I would say we've we've we've allocated some dollars on our guidance for this .

Speaker #4: Yeah. And Drew, an example would be what we were talking about earlier in the previous question in Ohio, where we can really grow and share to get closer to our fair share.

Frédéric Perron: Yeah. Drew, an example would be what we were talking about earlier in the previous question in Ohio, where we can really grow share to get closer to our fair share. We're making the investment in achieving that and it's starting to yield some benefit. That investment is increasing but will pay back. The other example is wireless as Patrice explained earlier.

Frédéric Perron: Yeah. Drew, an example would be what we were talking about earlier in the previous question in Ohio, where we can really grow share to get closer to our fair share. We're making the investment in achieving that, and it's starting to yield some benefit. That investment is increasing but will pay back. The other example is wireless, as Patrice explained earlier.

Speaker #4: So we're making the investment in achieving that . And it's starting to yield some benefit . So there's so that investment is increasing but will pay back .

Speaker #4: The other example is wireless as Patrice explained earlier .

Speaker #5: Yeah . And on the second question on the 100 million actually it's something we've had . We put it in the annual report , but we've had it for a few years .

Patrice Ouimet: Yeah. On the second question on the $100 million, actually it's something we've had, we put it in the annual report but we've had it for a few years. Basically, we have mentioned a few years ago that we might invest and it's not CapEx, actually those would be investments in smaller companies to produce growth later on, more in startup mode. It's not something we've done so far but it's not new disclosure, actually if you go back to last year, we'll see if we do some. I do not expect it to be CapEx and no impact on free cash flow or anything. It would be more an investment on the balance sheet.

Patrice Ouimet: Yeah. On the second question on the CAD 100 million, actually, it's something we've had. We put it in the annual report, but we've had it for a few years. It's basically, we have mentioned a few years ago that we might invest, and it's not CapEx, actually. Those would be investments in smaller companies to produce growth later on. More in startup mode. It's not something we've done so far, but it's not new disclosure actually, if you go back to last year. We'll see. If we do some, I do not expect it to be CapEx and no impact on free cash flow or anything. It would be more an investment on the balance sheet.

Speaker #5: It's basically we have mentioned a few years ago that we might invest , and it's not CapEx , actually , those would be investments in smaller companies to produce growth later on .

Speaker #5: So more in startup mode . It's not something we've done so far , but it's not new disclosure . Actually , if you go back to last year .

Speaker #5: So we'll see if we do some . I do not expect it to be CapEx and not no impact on free cash flow or anything .

Speaker #5: It would be more an investment on the balance sheet .

Speaker #14: Okay . Thank you for that clarification . Then maybe one last one and I may have missed this in terms of the rate of network or footprint expansion expect in fiscal 2026 relative to the 50,000 .

[Analyst]: Okay, thank you for that clarification. Maybe one last one. I may have missed this in terms of the rate of network or footprint expansion expected in fiscal 2026 relative to the 50,000 and then fiscal 2025. Do you have that for us?

Drew McReynolds: Okay. Thank you for that clarification. Maybe one last one, and I may have missed this. In terms of the rate of network or footprint expansion you expect in fiscal 2026, relative to the 50,000 you did in fiscal 2025, do you have that for us?

Speaker #14: And fiscal 2025 . Do you have that for us ?

Speaker #5: Yeah , it would probably be similar . So I would say Canada , because we're going to be it's a mix of what we're doing in Ontario and also , as I said earlier , what we're doing in footprint .

Patrice Ouimet: Yeah, it would probably be similar. I would say Canada because we're going to be, it's a mix of what we're doing in Ontario and also as I said earlier, what we're doing in footprints on new neighborhoods and new streets. We'll probably be around 40,000 addition in Canada. U.S. will be lower. We have less of these bigger programs, probably closer to 10,000 new homes.

Patrice Ouimet: Yeah. It would probably be similar. I would say, Canada. It's a mix of what we're doing in Ontario and also, as I said earlier, what we're doing in footprints on new neighborhoods and new streets. We'll probably be around in around 40,000 addition in Canada. US will be lower. We have less of these bigger programs, probably closer to 10,000 new homes in US.

Speaker #5: So, new neighborhoods and new streets. We'll probably see around 40,000 additions in Canada. The U.S. will be lower, as we have less of these bigger programs.

Speaker #5: So probably closer to 10,000 new homes in the US .

[Analyst]: In the U.S., okay, great. Thanks very much.

Speaker #14: Okay , great . Thanks very much .

Drew McReynolds: Okay, great. Thanks very much.

Speaker #3: There are no further questions at this time . I will now turn the call over to Patrice Ouimet for closing remarks .

Operator: There are no further questions at this time. I will now turn the call over to Patrice Ouimet for closing remarks.

Operator: There are no further questions at this time. I will now turn the call over to Patrice Ouimet for closing remarks.

Speaker #5: All right . So we're right on time . So thank you everyone for these questions and happy to take additional questions . If you want to talk to us in before our next scheduled call for the Q1 results .

Patrice Ouimet: All right, we're right on time. Thank you, everyone, for these questions, and happy to take additional questions if you want to talk to us before our next scheduled call for the Q1 results. Thank you. Have a good day.

Patrice Ouimet: All right. We're right on time. Thank you everyone for these questions. I'm happy to take additional questions if you wanna talk to us in before our next scheduled call for the Q1 results. Thank you. Have a good day.

Speaker #5: Thank you . Have a good day . .

Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.

Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.