Q1 2026 Quebecor Inc Earnings Call

May 14, 2026

Operator: Good day, everyone, and thank you for standing by. Welcome to the Quebecor Inc.'s Financial Results for the Q1 2026 Conference Call. I would like to introduce Hugues Simard, Chief Financial Officer of Quebecor Inc. Please go ahead.

Speaker #2: Ladies and gentlemen, welcome to this Quebecor conference call. My name is Hugues Simard. I'm the CFO, and joining me to discuss our financial and operating results for the first quarter of 2026 is Pierre Pladeau, our President and CEO.

Hugues Simard: Ladies and gentlemen, welcome to this Quebecor conference call. My name is Hugues Simard, I'm the CFO, and joining me to discuss our financial and operating results for Q1 of 2026 is Pierre-Karl Péladeau, our President and CEO. Anyone unable to attend the conference call will be able to access the recorded version by logging on to the webcast available on Quebecor's website until 13 July 2026. As usual, I also want to inform you that certain statements made on the call today may be considered forward-looking, and we would refer you to the risk factors outlined in today's press release and reports filed by the corporation with regulatory authorities. I will now turn the floor to Pierre-Karl.

Speaker #2: Anyone unable to attend the conference call will be able to access the recorded version by logging on to the webcast available on Quebecor's website until July 13 of this year.

Speaker #2: As usual, I also want to inform you that certain statements made on the call today may be considered forward-looking. And we would refer you to the risk factors outlined in today's press release and reports filed by the Corporation with regulatory authorities.

Speaker #2: I will now turn the floor to Pierre. Merci again. Good afternoon, everyone. I'm happy to report once again solid operational and financial results for Quebecor in the first quarter of 2026.

Pierre Karl Péladeau: Merci, Hugues, and good afternoon, everyone. I'm happy to report once again solid operational and financial results for Quebecor in Q1 2026. We're continuing to deliver on our plan quarter after quarter, profitably growing our wireless market share across Canada, generating superior cash flows, and reducing our leverage to maintain the best balance sheet of the industry. On a consolidated basis in Q1 2026, Quebecor increased its adjusted cash flow from operation by CAD 40 million or 10% to CAD 444 million. Its EBITDA, excluding stock-based compensation, by CAD 74 million or 13% to CAD 577 million, and its adjusted net income by CAD 34 million or 19% to CAD 220 million.

Speaker #2: We're continuing to deliver on our plan quarter after quarter. Profitably growing our wireless market share across Canada. Generating superior cash flows and reducing our leverage to maintain the best balance sheet in the industry.

Speaker #2: On a consolidated basis in the first quarter of 2026, Quebecor increased its adjusted cash flow from operations by $40 million, or 10%, to $444 million.

Speaker #2: Its EBITDA excluding stock-based compensation was up by $74 million, or 13%, to $577 million, and its adjusted net income was up by $34 million, or 19%, to $200 million.

Speaker #2: We reduced our debt by more than $120 million in the quarter after buying back more than $85 million of our stock and thus improved our net debt-to-EBITDA ratio from 3.26 times in the same quarter last year to 2.86 times till the lowest leverage of the Canadian industry while investing $133 million in capital expenditures to continue to improve our networks, our system, and our client experience to fuel our resilient and profitable growth.

Pierre Karl Péladeau: We reduced our debt by more than CAD 120 million in the quarter after buying back more than CAD 85 million of our stock, and thus improve our net debt to EBITDA ratio from 23.26x in the same quarter last year to 2.86x, still the lowest leverage of the Canadian industry, while investing CAD 133 million in CapEx to continue to improve our networks, our system, and our client experience to fuel our resilient and profitable growth. I will now review our operational results, starting with our telecom segment. I'm very pleased to report what I believe is one of, if it's not the strongest, Q1 in our company's history.

Speaker #2: I will now review our operational result, starting with our telecom segment. I'm very pleased to report what I believe is one of, if it's not the strongest first quarter in our company's history.

Speaker #2: Our telecom segment delivered adjusted EBITDA of $620 million, up 6.6% year over year, with a margin of 50.9%, up 80 basis points. Adjusted cash flows from operations reached $489 million, up 11%.

Pierre Karl Péladeau: Our telecom segment delivered adjusted EBITDA of CAD 620 million, up 6.6% year over year, with a margin of 50.9%, up 80 basis points. Adjusted cash flows from operations reached CAD 489 million, up 11%. Total revenues came in at CAD 1.2 billion, up 5%, with service revenues of CAD 1 billion, growing 4% year over year. These are record results for a Q1 and a pretty good start for the year. The impressive performance was once again fueled by our wireless operations, where service revenues were up 8.8% year over year at CAD 466 million, with consolidated mobile ARPU growing for a second consecutive quarter and reaching CAD 35.89, up 1.4%. Up, not down like all our competitors.

Speaker #2: Total revenues came in at $1.2 billion up 5%, with service revenues of $1 billion growing 4% year over year. These are record results for a first quarter in a pretty good start for the year.

Speaker #2: Impressive performance was once again fueled by our wireless operations. Where service revenues were up 8.8% year over year, at $466 million with consolidated mobile R2 growing for a second consecutive quarter and reaching $35.89 up 1.4%, up not down like all our competitors.

Speaker #2: In a market where the dominant narrative had been price compression and R2 erosion, for some time, our R2 is actually growing. And growing not because we're attracting or retaining customers with short-term unsustainable and ill-advised promotional offers.

Pierre Karl Péladeau: In a market where the dominant narrative had been price compression and ARPU erosion for some time, our ARPU is actually growing. Growing not because we're attracting or retaining customers with short-term, unsustainable, and ill-advised promotional offers. Growing because our customers are increasingly happy with our reliability, performance, service, and prices, and are thus choosing to stay and upgrade. This is the difference between a customer base earned with value and one rented through discounts. In terms of subscriber growth, we added 28,800 net mobile lines in Q1 2026. While this is much lower than the 52,900 net additions we reported in Q1 last year, it is the result of our continuing disciplined focus on profitable growth as opposed to buying short-term loading.

Speaker #2: Growing because our customers are increasingly happy with our reliability, performance, service, and prices, and are thus choosing to stay and upgrade. This is the difference between a customer base earned with value and one rented through discounts.

Speaker #2: In terms of subscriber growth, we added 28,000 net mobile lines in Q1 2026. While this is much lower than the 52,900 net additions we reported in the first quarter last year, it is the result of our continued disciplined focus on profitable growth as opposed to buying short-term loading.

Speaker #2: As you know, this quarter unfolded as one of the most aggressively promotional wireless environments in recent memory. With the incumbents maintaining deep discounting campaigns in all channel well into April.

Pierre Karl Péladeau: As you know, this quarter unfolded as one of the most aggressively promotional wireless environments in recent memory, with the incumbents maintaining deep discounting campaigns in all channels well into April. Which made little sense, to be honest, unless their compensation is tied to unit growth, which is not how we operate at Quebecor. Basically, a slow organic growth quarter where the big three stole customers from one another at ridiculous prices. This is simply unsustainable. The math doesn't work. We much prefer our math, which led us to 37% of the total market loading in the quarter at prices that are improving our ARPU and service revenues. With the lowest cost structure on the market and the lowest ARPU to the fan, we have significant pricing flexibility to compete aggressively while maintaining compelling unit economics.

Speaker #2: Which made little sense, to be honest. Unless they're compensation is tied to unit growth, which is not how we operate at Quebecor. Basically, a slow organic growth quarter where the big three stole customers from one another at ridiculous prices.

Speaker #2: This is simply unsustainable. The map doesn't work. We much prefer our map, which led us to 37% of the total market loading in the quarter at prices that are improving our R2 and service revenues.

Speaker #2: With the lowest cost structure on the market, the lowest R2 to the fan, we have significant pricing flexibility to compete aggressively while maintaining compelling unit economics.

Speaker #2: This structural advantage, which we have built over many years, is durable and will continue in our favor for quite some time. As our competitors struggle with expensive cash flow draining heavy restructurings, and workforce reduction.

Pierre Karl Péladeau: This structural advantage, which we have built over many years, is durable and will continue in our favor for quite some time as our competitors struggle with expensive, cashflow-draining, heavy restructurings and workforce reduction. As we mark 3 years since the Freedom Mobile acquisition, the evidence is clear. Canadian families are paying less for wireless. We have accelerated our infrastructure investment and expanded our network footprint. These are not projections. These are measurable outcomes of a decision that reshaped the competitive dynamic of Canadian telecommunications. We are not done. Actually, we are just getting started. On 24 February, we launched our Total Freedom plans, offering seamless connectivity across Canada and 120 international destinations, powered by our 5G+ network with a price freeze commitment. In a market where consumers have been conditioned to expect annual price increases, this is a genuine differentiator.

Speaker #2: As we mark three years since the Freedom Mobile acquisition, the evidence is clear. Canadian families are paying less for wireless. We have accelerated our infrastructure investment and expended our network footprint.

Speaker #2: These are not projections. These are measurable outcomes of a decision that reshaped the competitive dynamic of Canadian telecommunications. And we are not done. Actually, we are just getting started.

Speaker #2: On February 24th, we launched our total freedom plans offering seamless connectivity across Canada in 120 international destinations powered by our 5G plus network with a price freeze commitment.

Speaker #2: In a market where consumers have been conditioned to expect annual price increases, this is a genuine differentiator. On the B2B front, has been a trusted technology partner for Quebec businesses for over 20 years.

Pierre Karl Péladeau: On the B2B front, Vidéotron Affaires has been a trusted technology partner for Quebecor, for Quebec businesses for over 20 years. We're now expanding that expertise nationally, bringing our business services to Ontario and Western Canada, leveraging Freedom Mobile expanding national network. We're still in the early innings, of course, this is a vast and largely untapped opportunity for us. Turning to wireline, still our largest cashflow generator. We delivered service revenues of CAD 565 billion in Q1, up 0.4% year over year, and the first increase since Q3 2023. This inflection reflects the cumulative effect of Vidéotron's network investment and a broadband strategy that is beginning to deliver measurable revenue improvements.

Speaker #2: We are now expanding that expertise nationally bringing our business services to Ontario and Western Canada. Leveraging Freedom Mobile expanding national network. We're still in the early innings of course, but this is a vast and largely untapped opportunity for us.

Speaker #2: Turning to wireline, still our largest cash flow generator. We delivered service revenues of $565 billion in the first quarter, up 0.4% year over year.

Speaker #2: In the first increase since Q3 2023, this inflection reflects the cumulative effect of wireless network investment in a broadband strategy that is beginning to deliver measurable revenue improvements.

Speaker #2: On April 10th, we launched Internet 2 Giga, delivered download speed of up to 2,000 megabytes per second, and upload speeds of up to 200 megabytes per second in the greater Montreal area, Laval, and Quebec City.

Pierre Karl Péladeau: On 10 April, we launched Internet 2 GIGA, delivered download speed of up to 2,000 MB per second and upload speeds of up to 200 MB per second in the greater Montreal area, Laval, and Quebec City. This is not a feature enhancement for a niche audience. It is a significant step forward in residential broadband based on our existing infrastructure, deployed efficiently and designed to serve the rapidly expanding bandwidth needs of household and business in our core markets. In TV distribution, we're able, contrary to the industry, to maintain our revenues and margins thanks to the strength of our LX platform and our illico+ revenue growth. With the recent publication of Léger 2026 reputation survey, Videotron was recognized as the most respected telecom provider in Quebec for the 20th time since 2006.

Speaker #2: This is not a feature enhancement for a niche audience. It is a significant step forward in residential broadband, based on our existing infrastructure, deployed efficiently and designed to serve the rapidly expanding bandwidth needs of households and businesses in our core markets.

Speaker #2: In TV distribution, we’re able, contrary to the industry, to maintain our revenues and margins thanks to the strength of our Helix platform and our HeliCode Plus revenue growth.

Speaker #2: With the recent publication of Léger. 2026 reputation survey was recognized as the most respected telecom provider in Quebec for the 20th time since 2006.

Pierre Karl Péladeau: Two decades of top recognition, not by an industry panel, but by the Quebec population, rendering its verdict independently year after year on how this company treats the people who choose to do business with it. The customer trust and the appreciation that underlie this recognition is the same strong foundation that produce our industry-low churn, our growing ARPU, and ultimately, the superior financial results we are reporting today. It is a hugely valuable asset that does not appear in our balance sheet, but one in which we have been wisely investing for many years, and now among the most durable competitive advantages we possess. As I look ahead to the remainder of 2026, I am confident in our trajectory.

Speaker #2: Two decades of top recognition—not by an industry panel, but by the Quebec population. Rendering its verdict independently, year after year, on how this company treats the people who choose to do business with it.

Speaker #2: The customer trust and the appreciation that underlie this recognition is the same strong foundation that produces our industry low churn our growing R2 and ultimately the superior financial results we're reporting today.

Speaker #2: It is usually valuable asset that does not appear in our balance sheet but one in which we have been wisely investing for many years.

Speaker #2: And now, among the most durable competitive advantages we possess. As I look ahead to the remainder of 2026, I am confident in our trajectory.

Speaker #2: Our wireless platform, with our three complementary brands—Freedom Mobile and Fizz—is generating both volume and ARPU growth, keeping our churn rate among the lowest and most resilient, and accelerating our service revenue momentum.

Pierre Karl Péladeau: Our wireless platform, with our three complementary brands, Vidéotron, Freedom Mobile, and Fizz, is generating both volume and ARPU growth, keeping our churn rate among the lowest and more, most resilient in accelerating our service revenue momentum. Our wireline business had returned to revenue growth with our recent network innovation positioning us for continued broadband leadership. Our cost structure remained the most competitive in the Canadian telecom sector, and our increasing cash flows give us the financial flexibility to invest wisely to fuel our continuing growth and create long-term value for our shareholders. Turning now to the media segment. Groupe TVA is beginning to see the concrete results of the sustained efforts deployed over the past several years to simplify our structures and streamline our operations in order to better face the ongoing crisis affecting the entire media industry.

Speaker #2: Our wireline business and return to revenue growth, with our recent network innovation, are positioning us for continued broadband leadership. Our cost structure remains the most competitive in the Canadian telecom sector.

Speaker #2: In our increasing cash flows give us the financial flexibility to invest wisely to fuel our continued growth and create long-term value for our shareholders.

Speaker #2: Turning now to the Media segment, Groupe TVA is beginning to see the concrete results of the sustained efforts deployed over the past several years to simplify our structures and streamline our operations in order to better face the ongoing crisis affecting the entire media industry.

Speaker #2: In the first quarter of 2026, Groupe TVA reported negative adjusted EBITDA of $1 million. An improvement of $20 million compared to the same quarter 2025, mostly driven by the benefits of these initiatives.

Pierre Karl Péladeau: In Q1 2026, Groupe TVA reported adjusted EBITDA of -CAD 1 million, an improvement of CAD 20 million compared to Q1 2025, mostly driven by the benefits of these initiatives. While we welcome these results, we remain extremely cautious in the context of deep structural crisis that continue to shake, sorry, to shape the industry. The stranglehold of the GAFAM in the advertising market, the erosion of television subscriptions, the significant reduction in support from the Canadian Media Fund, the unfair competition from the CBC/Radio-Canada, and the heavy regulatory burden imposed by the CRTC continue to undermine private broadcasters.

Speaker #2: While we welcome these results, we remain extremely cautious in the context of deep structural crisis that continued to shake—sorry, to shake—yeah, and to shake the industry.

Speaker #2: The strange hold of the GAFAM and the advertising market, the erosion of television subscriptions, the significant reduction in support from the Canadian Media Fund, the unfair competition from the CBC/Radio-Canada, and the heavy regulatory burden imposed by the CRTC continue to undermine private broadcasters.

Pierre Karl Péladeau: Faced with these persistent challenges, a mobilization of all stakeholders, including the governments, the CRTC, and industry association, and unions, is needed to rebuild a viable model adapted to market realities in order to preserve our collective ability to produce and deliver local news, entertainment, and sports content, and to support the entire ecosystem that depends on it. I will now let Hugues review our detailed financial results.

Speaker #2: Faced with these persistent challenges, a mobilization of all stakeholders, including the governments, the CRTC, and industry associations and unions, is needed to rebuild a viable model adapted to market realities in order to preserve our collective ability to produce and deliver local news, entertainment, and sports content, and to support the entire ecosystem that depends on it.

Speaker #2: I will now let Big review our detailed financial results. Merci, Pierre Carle. On a consolidated basis, in the first quarter of this year, Quebecor recorded revenues of $1.4 billion, up $52 million, or 4%, from last year.

Hugues Simard: Merci, Pierre-Karl. On a consolidated basis in Q1 of this year, Groupe Québecor recorded revenues of 1.4 billion, up CAD 52 million or 4% from last year. EBITDA reached 577 million, an increase of CAD 27 million or 5%, or a CAD 74 million or 13% increase when excluding the unfavorable impact of a CAD 47 million rise in share-based compensation expense across all of the corporation segments. Cash flows from operating activities reached CAD 420 million stable year over year, as the EBITDA improvement was partially offset by high current income taxes.

Speaker #2: EBITDA reached $577 million, an increase of $27 million or 5%, or a $74 million, or 13%, increase when excluding the unfavorable impact of a $47 million rise in share-based compensation expense across all of the corporation's segments.

Speaker #2: Cash flows from operating activities reached $420 million stable year over year, as the EBITDA improvement was partially offset by high current income taxes. In our telecom segment, total revenues increased 5% or 57 million dollars, with growth from both wireless where revenues were up 9.5% to $608 million, and wireline where revenues up 0.4% to $565 million.

Hugues Simard: In our telecom segment, total revenues increased 5% or CAD 57 million, with growth from both wireless, where revenues were up 9.5% to CAD 608 million, and wireline, with revenues up 0.4% to CAD 565 million, marking the first positive wireline revenue Q in nearly 3 years. Total service revenues, the primary indicator of our recurring revenue base, reached CAD 1 billion, up 4% from CAD 992 million a year ago. This acceleration reflects the structural improvement in wireless ARPU, combined with the wireline revenue inflection, a second competitive Q of year-over-year service revenue growth.

Speaker #2: Marking the first positive wireline revenue quarter in nearly three quarters, the primary indicator of our recurring revenue base reached $1 billion, up 4% from $992 million a year ago. This acceleration reflects the structural improvement in wireless R2 combined with the wireline revenue inflection—a second competitive quarter of year-over-year service revenue growth.

Speaker #2: With rigorous cost management, adjusted EBITDA reached $620 million, up $38 million or 6.6%, our best performance ever in the first quarter, with adjusted EBITDA margin reaching 50.9%, an 80 basis point improvement year over year.

Hugues Simard: With rigorous cost management, adjusted EBITDA reached CAD 620 million, up CAD 38 million or 6.6%, our best performance ever in the Q1, with adjusted EBITDA margin reaching 50.9%, an 80 basis point improvement year over year. Telecom CapEx spending, excluding spectrum licenses, was down by CAD 12 million or 8% in the quarter, essentially due to a timing of a number of investment projects underway this year. Our 5G+ rollout remains on track and the recent commercial launch of Internet 2 GIGA, as Pierre-Carl mentioned, is a clear example of the high impact investments we continue to make. As a result, quarterly adjusted cash flows from operations increased CAD 50 million or 11% to reach CAD 489 million.

Speaker #2: Telecom CapEx spending excluding spectrum licenses was down by $12 million, or 8%, in the quarter, essentially due to the timing of a number of investment projects underway this year.

Speaker #2: Our 5G, 5G Plus rollout remains on track, and the recent commercial launch of Internet 2 Giga as Pierre Carle mentioned is a clear example of the high impact investments we continue to make.

Speaker #2: As a result, quarterly adjusted cash flows from operations increased $50 million or 11% to reach $489 million. Our media segment revenues came in at $157 million down 5% or 8 million, year over year, while EBITDA improved by $16 million to a $2 million loss, reflecting the benefits of the cost reduction initiatives and a favorable impact from the federal government's cancellation of the digital services tax.

Hugues Simard: Our media segment revenues came in at CAD 157 million, down 5% or CAD 8 million year-over-year, while EBITDA improved by CAD 16 million to a CAD 2 million loss, reflecting the benefits of the cost reduction initiatives and a favorable impact from the federal government's cancellation of the Digital Services Tax. Our sports and entertainment segment revenues decreased by 1% to CAD 49 million, and EBITDA was down CAD 2 million for the quarter. Quebecor reported a net income attributable to shareholders of CAD 225 million in the quarter or CAD 1 per share, compared to a net income of CAD 191 million or CAD 0.82 per share reported in the same quarter last year.

Speaker #2: Our Sports and Entertainment segment revenues decreased by 1% to $49 million, and EBITDA was down $2 million for the quarter. It was down two, $2 million for the quarter.

Speaker #2: Quebecor reported a net income attributable to shareholders of $225 million in the quarter or $1 per share compared to a net income of $191 million or 82 cents per share reported in the same quarter last year.

Speaker #2: Adjusted net income, excluding unusual items, came in at $220 million, or $0.97 per share, compared to adjusted net income of $185 million, or $0.80 per share, in the same quarter last year.

Hugues Simard: Adjusted net income excluding unusual items came in at CAD 220 million or CAD 0.97 per share, compared to an adjusted net income of CAD 185 million or CAD 0.80 per share in the same Q last year. As of the end of the Q, Quebecor's Net Debt to EBITDA ratio decreased to 2.86 times, still the lowest among telecom operators by quite some margin. As we continue to proactively optimize our capital structure, we launched in April, on 1 April of this year, a US $1 billion commercial paper program in the United States, further diversifying our funding sources and providing additional flexibility at attractive short-term rates. The very next day, we used available liquidity to repay the CAD 500 million balance on the second tranche of our term credit facility.

Speaker #2: As of the end of the quarter, Quebecor's net debt to EBITDA ratio decreased to 2.86 times, still the lowest among telecom operators by quite some margin.

Speaker #2: As we continue to proactively optimize our capital structure, we launched, on April 1st of this year, a US$1 billion commercial paper program in the United States, further diversifying our funding sources and providing additional flexibility at attractive short-term rates.

Speaker #2: The very next day, we used available liquidity to repay the $500 million balance on the second tranche of our term credit facility. All in all, we continue to preserve the best-in-class balance sheet with available liquidity of over $1.7 billion at the end of the quarter.

Hugues Simard: All in all, we continue to preserve the best-in-class balance sheet with available liquidity of over 1.7 billion at the end of the quarter. In the quarter, we purchased and canceled 1.5 million Class B Shares for a total investment of CAD 85 million. We are pleased to announce that on 13 May, we received approval from the TSX to increase the maximum number of Class B Shares that may be repurchased under this year's program, which ends on 15 August, to 7 million shares. We thank you for your attention and will now open the lines for your questions.

Speaker #2: In the quarter, we purchased and canceled 1.5 million Class B shares for a total investment of $85 million. And we are pleased to announce that, on May 13th, we received approval from the TSC to increase the maximum number of Class B shares that may be repurchased under this year's program, which ends on August 15th, to 7 million shares.

Speaker #2: We thank you for your attention, and we'll now open the lines for your questions.

Speaker #1: 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.

Operator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. One moment please for your first question. Your first question comes from Sebastiano Petti with JPMorgan. Your line is now open.

Speaker #1: You will hear a prompt that your hand has been raised. Did you wish to decline from the polling process? Please press star, followed by the two.

Speaker #1: If you are using a speakerphone, please lift the hands up before pressing any keys. One moment, please for your first question. Your first question comes from Sebastiano Petty with JPMorgan.

Speaker #1: Your line is now open.

Speaker #3: Hi, thank you for the question. Just real quick, on mobile phone R2, up for the second consecutive quarter—you know, Pierre Karl, you talked about focusing on profitable loadings.

Sebastiano Petti: Hi. Thank you for the question. Just real quick on mobile phone ARPU up for the second consecutive quarter. You know, Pierre-Carl, you talked about, you know, focusing on profitable loadings. Should we anticipate or is despite the competitive environment, do you think the ARPU trajectory or the growth profile can kind of continue through the balance of the year? Hugues, on the CapEx expectations, a little bit lighter for the year, for the Q1 rather, but I think you said that was partially due to timing. I think you provided some context on how to think about capital spend for the balance of the year on the Q4 call. Remind us, is that still the right level as you're kind of thinking about the 2026 spend?

Speaker #3: should we anticipate or is, is despite the competitive environment, do you do you think that R2 trajectory or the growth profile can kind of continue through the balance of the year?

Speaker #3: And then, Hugues, on the CapEx expectations—a little bit lighter for the year, for the first quarter rather—but I think you said that was partially due to timing.

Speaker #3: I think you provided some context on how to think about capital spend for the balance of the year on the Q4 call. Remind us, is that still the right level, as you're kind of thinking about the 2026 spend?

Sebastiano Petti: I think there's a year-on-year increased target or a figure you kind of cited last quarter. Thank you both.

Speaker #3: I think there's a year-on-year increase target or figure you kind of cited last quarter. Thank you both.

Sebastiano Petti: I think there's a year-on-year increased target or a figure you kind of cited last quarter. Thank you both.

Hugues Simard: Good afternoon, Sebastiano. Sorry. I guess, you know what I would say is that we stayed our course. I mean, we don't know what the market will be tomorrow. We in fact, you know, we expect the worst to be ready, you know, for the best. So yeah, been focusing on our cost base. This is something of importance. We believe that our cost base will continue, you know, to go lower. Therefore, if, you know, the market was to go more aggressive or as aggressive as it was before, we think that, you know, we're gonna be able to keep the track where we've been going, which is, you know, growing with profitable direction.

Speaker #4: Yes, good afternoon, Sebastiano. Sorry. I guess, you know, what, what I would say is that we stayed, of course, I mean, we don't know what the market will be tomorrow, we, in fact, you know, we expect the worst.

Speaker #4: To be ready, you know, for the best. So, you know, I’ve been focusing on our cost base. This is something of importance.

Speaker #4: and we believe that our cost base will continue, you know, to, to go lower. And therefore, if, you know, the market was to go, more aggressive or as aggressive as it was before, we think that, you know, we're going to be able to, to we've got, we've been going, which is, you know, growing, with, profitable direction.

Hugues Simard: Again, while you guys have been looking at the market, I, you know, We follow you, obviously, as you can imagine. It looks like, you know, you're watching the market every day, probably in different areas of Canada, so you're well aware of the situation. We are never, you know, going in.

Speaker #4: and again, well, I, you guys have been looking at the market, you know, you, you, you look, you know, we, we follow you, obviously, as you can imagine.

Speaker #4: And it looks like, you know, that you're watching the market every day, probably in different areas, Canada. So, you're well aware of the situation.

Speaker #4: We, our—never, you know, going in this sometimes crazy discount direction. What we do is, we try to innovate, you know, and in fact, this is what we did.

Pierre Karl Péladeau: This sometime crazy discount direction, what we do is we try to innovate, you know, and in fact, this is what we did by proposing new formulas, new packages, new things that will make, you know, the market more interesting and more vibrant. I guess that, you know, at the end of the day, we should say that, you know, our results are not too bad. This is why, you know, our ARPU grew instead of going in the other direction, like we've been seeing, you know, with our competitors. We have room to grow. This is very interesting. Therefore, the roots and the base are solid, and we look forward to continue in the same direction.

Speaker #4: By proposing new formulas, new packages, new things that will make, you know, the market more interesting and more vibrant. And I guess that, you know, at the end of the day, we should say that, you know, our results are not too bad.

Speaker #4: And this is why, you know, our, our R2, grew. Instead of going in the other direction, like we've been seeing, you know, with, with our competitors.

Speaker #4: We have room to grow. This is very interesting. And therefore, the roots and the base are solid, and we look forward to continuing in the same direction.

Hugues Simard: On CapEx, Sebastiano, yeah, a little light in the quarter, 12 or 13 million light, as you saw. A bit of timing, as I said in my remarks. Also, to be honest, you know, some prudence, as the quarter was going, you know, in our view, crazily, a little bit crazily and unnecessarily competitive. We just wanted to keep some powder. We're very disciplined on some of the projects that were less revenue related or growth related. It's, you know, as Jacques said, depending on what's gonna happen in the market going forward, we should be. There's no change at this point in our mind in terms of our CapEx guidance.

Speaker #3: On CapEx, on CapEx, Sebastiano, yeah, a little light in the quarter, $12 or $13 million light. As you saw, a bit of timing, as I said in my remarks.

Speaker #3: and, and also to be honest, you know, some, some prudence. as the quarter was going, you know, in our view, crazily, a little bit crazily, and, unnecessarily competitive.

Speaker #3: And, we just, wanted to keep some powder and, we're very, we're very disciplined on, on, some of the projects that were less revenue, related or, or growth related.

Speaker #3: But, but it, it, if, if, you know, as Pierre Carle said, depending on what, what, what's going to happen in the market going forward, you know, we, we should be—there's no change at this point in our mind in terms of our CapEx guidance.

Hugues Simard: You know, it's always good to be a little prudent at the beginning of the year so that you can adjust if things get out of control.

Speaker #3: But, you know, it's always good to be a little prudent at the beginning of the year, so that you can adjust if things get out of control.

Hugues Simard: You know, it's always good to be a little prudent at the beginning of the year so that you can adjust if things get out of control.

Speaker #2: Thank you both.

Pierre Karl Péladeau: Thank you both. I'll go to the next question, please.

Speaker #4: I'll go to the next question, please.

Speaker #1: Your next question comes from Drew McReynolds with RBC. Your line is now open.

Operator: Your next question comes from Drew McReynolds with RBC. Your line is now open.

Speaker #3: Yeah, thanks very much. And obviously, a great result. A couple for me—maybe Hugues, just unpacking, you know, wireless R2—clearly, return to growth, which looks sustainable.

Drew McReynolds: Yeah. Thanks very much and, obviously a great result. A couple for me, maybe Hugues. Just unpacking, you know, wireless ARPU, clearly return to growth, which looks sustainable. Can you comment on just mix versus price and what kind of dynamics you're seeing on that front across, you know, the various brands versus kind of core price increases on average within each brand? Obviously, there's a little bit of an ARPU restatement. I'm just assuming that's a base adjustment of some sort, but maybe you could clarify that. I just have one more afterwards.

Speaker #3: Can you comment on just mix versus price, and what kind of dynamics you're seeing on that front across the various brands, versus kind of core price increases on average within each brand?

Speaker #3: And, obviously, there's a little bit of an R2 restatement. I'm just assuming that's a base adjustment of some sort, but maybe you could clarify that.

Speaker #3: And then I just have one more afterwards.

Pierre Karl Péladeau: Yeah Hugh answer the question, I think that, you know, and you mentioned it, one of the great advantage we have other than the one that we've been mentioning also is our brands. We have many brands, and all brands are looking for a certain segment. We certainly not cover all the segments. Well, we cover most of them with Fizz, you know, our digital brand. On top of being a low-cost operator, it also bring, you know, the capacity to move forward in this segment of, let's call it techie, more techie people than usual normal population. As you know, it's been very successful in Quebec since its launch. We expect, you know, the same success with the other markets that we're servicing in Canada.

Speaker #4: The, the four, yeah, Hugues answered the question. I think that, you know, and you mentioned it. One of the great advantages we have, other than the one that we've been mentioning also, is our brands.

Speaker #4: So, we have many brands, and all brands are looking for a certain segment. And we certainly do not cover all the segments, but we cover most of them.

Speaker #4: And with Fizz, you know, our digital brand, on top of being a low-cost operator, it also brings, you know, the capacity to move forward in this segment of, let's call it techie, more techie people than usual, normal population.

Speaker #4: And as you know, it's been very successful in Quebec since its launch, and we expect, you know, the same success with the other markets that we're servicing in Canada.

Speaker #4: Please, Hugues, would you—would you move?

Pierre Karl Péladeau: Please, Hugues, would you.

Hugues Simard: Yeah. On your wireless ARPU question, Drew. I think you are asking about the various brands, right? If I understood your question correctly. Yeah, growth on our main two brands. Fizz is, you know, Fizz grew particularly strongly in the quarter. Fizz is the brand, you will remember me saying this before, where we have a bit more of that flexibility that Jacques talked about a little bit before due to our low-cost structure.

Speaker #3: Yeah, yeah, on, on your, yeah, on your, on your wireless R2 question, Drew, I think you're asking about the various brands, right? If I understood your question, correctly.

Speaker #3: So, yeah, growth on our, on, on, on our main two brands, Fizz is, you know, you know, Fizz, grew particularly, strongly, in the quarter.

Speaker #3: And Fizz is the brand you will remember me mentioning before, where we have a bit more of that flexibility that Pierre Carle talked about a little bit earlier.

Speaker #3: Due to the, our low-cost structure, our low-cost structure, it is, it's, it's, it's a, it's a true statement across the company. But I'm sure you will, you will remember that it's particularly true in the case of Fizz.

Hugues Simard: Our low-cost structure it's a true statement across the company, but I'm sure you will remember that it's particularly true in the case of Fizz that has a very It's a lower price brand, but a lower cost structure as well, which allows us more flexibility to be more aggressive when we need to be. You know, generally, I mean, directionally, ARPU improving in our two main brands, both in Quebec and in Ontario and the West, with Fizz taking advantage of the competitive situation that was out there.

Speaker #3: That has a very—it's a lower-priced brand, but a lower-cost structure as well, which allows us more flexibility to be more aggressive when we need to be.

Speaker #3: so, you know, general, generally, I mean, directionally, R2 improving, in, in, in our two main brands. both in, in Quebec and, in, in Ontario in the West.

Speaker #3: with, Fizz taking advantage of, you know, of the competitive situation, that was out there. and, in terms of, of, of, you know, of profitability, which ultimately is what we look at, turned out to be, turned out to be positive, as you can, as, as you're, you're continuing to see in the numbers.

Hugues Simard: In terms of, you know, of profitability, which ultimately is what we look at, turned out to be positive as you can, as you're continuing to see in the numbers.

Speaker #2: And, and I would add to that that Drew, that, it, it's interesting, obviously, you know, it's easy to understand, but, you know, every, investment or additional capital expenditures that we're doing in our network, building our network, extending our network, brings, to the other side of the equation, a reduction or even, you know, reducing our roaming cost, which is obviously down the road, quite interesting profitable business.

Pierre Karl Péladeau: I would add to that, Drew, that, obviously, you know, it's easy to understand, but, you know, every investment or additional capital expenditures that we're doing in our network, building our network, extending our network, brings to the other side of the equation a reduction or even reducing our roaming cost, which is obviously, down the road, quite interesting, profitable business or perspective.

Speaker #2: Or perspective.

Hugues Simard: Drew, I just wanna come back to your comment about restatement because we don't, we have made no restatement that we know of. Perhaps you could tell us what you're seeing.

Speaker #3: Drew, I just want to come back to your comment about restatement, because we don't—we have made no restatement that we know of.

Hugues Simard: Drew, I just wanna come back to your comment about restatement because we don't, we have made no restatement that we know of. Perhaps you could tell us what you're seeing.

Speaker #3: So, perhaps you could tell us what you're seeing. But we're actually—we're actually going, sorry?

Pierre Karl Péladeau: Yeah, no.

Hugues Simard: We're actually quite. Sorry?

Speaker #4: Yeah, go ahead, Hugues. Sorry.

Pierre Karl Péladeau: Yeah, go ahead, Hugues. Sorry.

Speaker #3: No, I, I, I was going to say we're, we're, I, I was going to say that we're actually, we, you know, if anything, we're quite proud of the fact that, contrary to all of our competitors, I believe this quarter and a number of quarters before, I can assure you that there was no restatement, no change of calculation in any of the KPIs we put out.

Hugues Simard: No, I was gonna say that we're actually, you know, if anything, we're quite proud of the fact that, contrary to all of our competitors, I believe this quarter and a number of quarters before, I can assure you that there was no restatement, no change of calculation in any of the KPIs we put out. We didn't deduct anything or added anything in any of these, in any of these measures, and we're quite proud of that. If you saw a restatement, please tell me where it was because I'm sitting beside the CFO of Videotron who assures me there was no restatement.

Speaker #3: We didn't deduct anything or add anything, in any of these—in any of these measures. And we're quite proud of that. So, if you saw a restatement, please tell me where it was because I'm—I'm—I'm—I'm sitting beside the CFO of Videotron, who assures me there was no restatement.

Speaker #3: So.

Speaker #1: Well, I, I, I'll, I'll chalk that up to our, our mistake because I, I was surprised, you know, this morning when, when I, I, I saw something.

Drew McReynolds: Well, I'll chalk that up to our mistake because I was surprised, you know, this morning when I saw something. No, that's good to hear. One last one, Hugues, on my end. Interesting to see the sequential improvement in TV revenue, which, you know, I think has been many quarters since we've seen that. Can you just kinda talk to that kinda success? It seems like maybe a little bit more than just kind of a price increase flowing through. That's it for me. Thank you. Oh, on Are you referring to TV distribution? You're referring to cable?

Speaker #1: But no, that's good to hear. One last one, Hugues, on my end. So interesting to see the potential improvement in TV revenue, which I think has been many, many, many quarters since we've seen that.

Speaker #1: can you just kind of talk to, to that kind of success? it seems like maybe a, a little bit more than just kind of a, a price increase flowing through.

Speaker #1: and then that's it for me. Thank you.

Speaker #3: Well, on—on—are you referring to TV distribution? You're—you're referring to cable?

Speaker #1: That's right.

Pierre Karl Péladeau: That's right.

Hugues Simard: Yeah. The revenue increase in cable, it was rather flat, right? If I looked at the numbers. Which in and of itself is a good performance in this environment. You know, cable has been more resilient over the past few quarters. Performance has been better. It's, you know, there are a number of seasonal issues. You know, hockey has been, you know, very popular. As you know, does it help us reduce the churn rate on cable? Perhaps, you know, a little bit. There are probably, you know, some seasonal, some other seasonal reasons for that.

Speaker #3: yeah, the revenue increase, in cable, it was, it was rather flat, right? If I looked at the, at the numbers, which, which in, in, in and of itself is a good, is a good performance.

Speaker #3: in this environment. you know, cable has been more resilient over the past few quarters. Our performance has been better. it's, you know, there, there are a number of, seasonal, issues, you know, hockey is, has been, you know, very popular is, you know, does it, does it help us, reduce the, the churn rate on, on cable?

Speaker #3: Perhaps, you know, a little bit. There, there, there are probably, you know, some, some, some seasonal, some other seasonal reasons for that. But, you know, we, it, it's definitely a trend that we've been seeing.

Hugues Simard: You know, it's definitely a trend that we've been seeing, and if you look at our results, our performance rather over the last few quarters, you will see that we have been rather outperforming other cable calls in terms of our cable performance. You know, negative growth performance, if I can refer to that.

Speaker #3: And if you look at our, our results, our performance, rather, over the last few quarters, you will see that, we have been, rather, outperforming other cable companies in terms of, of our cable, performance.

Speaker #3: You know, negative growth performance, if I can refer to that.

Speaker #1: Yeah. Thanks very much.

Drew McReynolds: Yeah. Thanks very much.

Speaker #4: Thank you, Drew.

Hugues Simard: Thank you, Drew.

Operator: Your next question is from Matthew Griffiths with Bank of America.

Speaker #5: The next question. Your next question, from Matthew Griffiths with Bank of America. Your line is now open.

Operator: Your next question is from Matthew Griffiths with Bank of America.

Speaker #6: Yeah, hi. Thanks, good afternoon. Thanks for taking the question. I guess I first—I was hoping you could share sort of what you saw in churn, wireless churn, this quarter.

Matthew Griffiths: Yeah. Hi, thanks. Good afternoon. Thanks for taking the question. I guess I, first, I was hoping you could share sort of what you saw in churn, wireless churn, this quarter. I mean, everyone else on a blended basis seem to be, you know, somewhere in the, you know, close to 20 bips range, increase. it'd be interesting to hear what you saw and obviously how that relates to the net add performance. Was churn up but which drove lower net adds? were gross adds down and churn stable? Like that dynamic would just be interesting to hear how the competition amongst the larger three kind of ended up impacting you guys. you know, one question on satellite.

Speaker #6: I mean, everyone else, on a blended basis, seemed to be, you know, somewhere in the, you know, close to 20%, 20 bps range, increase.

Speaker #6: And, the interesting thing to hear what, you saw and obviously how that relates to the net ad performance. so was the, was churn up, but, which, which drove, lower net ads?

Speaker #6: Or, was, was growth, were gross ads down and churn stable? Like, that, that dynamic would just be interesting to hear how the competition amongst, the, the larger three kind of ended up impacting, you guys.

Speaker #6: And then, you know, one question on satellite. It's sort of topical to have, to see announcements coming from wireless providers about partnerships, or joint ventures that they're entering into to kind of service that.

Matthew Griffiths: Sort of topical to see announcements coming from wireless providers about partnerships, or joint ventures that they're entering into to kind of service that. What's relatively small part of the market, but it's perhaps additive overall. Do you feel as though you're at a disadvantage, without any type of offering? Or, you know, what would you think about, you know, how urgent it is to sign a deal perhaps to add that to the overall offering that you guys have? Would just be interested to hear your thoughts.

Speaker #6: What's relatively small part of the market, but it's, it's at perhaps additive overall. do you feel as though you're at a disadvantage, without any type of offering or, you know, what, what do you think about, you know, how urgent it is to sign a deal, perhaps, to add that to the overall offering that you guys have, would just be interesting to hear your thoughts.

Hugues Simard: You wanna start with the satellite?

Speaker #6: The satellite? Okay, I'll start. I'll, I'll.

Pierre Karl Péladeau: Satellite? Okay, yeah.

Speaker #4: Yeah. Yes, good afternoon, Matthew. Well, certainly, obviously, you know, this is an important and an interesting matter. Obviously, as you can imagine, you know, we're considering it, you know, we're looking at it.

Hugues Simard: Yeah.

Pierre Karl Péladeau: Yes. Good afternoon, Matthew. Well certainly, obviously, you know, this is an important and an interesting matter. Obviously, as you can imagine, you know, we're considering it. You know, we're looking at it. We analyze it. We're looking what's happening in the marketplace. I guess that, you know, you answered a little bit of the question when you mentioned, is it urgent? We're not considering it an urgent, and this is true that, you know, it's a small market. That doesn't mean that, you know, we should not look at it. In fact, you know, we're considering this is complementary or down the road, probably also of importance. This is why we are reviewing few avenues. I would say that, you know, it reminds me a little bit, you know, when 5G came in.

Speaker #4: We analyze it. We're looking at what's happening in the marketplace. But I guess that, you know, you answered a little bit of the question when you mentioned, is it urgent?

Speaker #4: We're not considering it inurgent. And this is true that, you know, it's a small market. But that doesn't mean that we should not, not look at it.

Speaker #4: In fact, you know, we're considering this is complementary or down the road, probably also the importance. So this is why, we are, reviewing few avenues.

Speaker #4: But I would say that, you know, it reminds me a little bit, you know, when 5G came in. 5G was—will—will change the, the, the, the face of the world.

Pierre Karl Péladeau: Say 5G will change the face of the world. You know, I remember a CEO that Betting on it will change the landscape. Many people were considering it. I guess at the end of the day, we were all distinct or having a different perspective than the one at the beginning we had. In our side, we didn't change our mind. We said that, you know, 5G obviously is a technology. It will take place like 5G replaced 4G, LTE 4G replaced 3G. It's a continuing continuum, I would say. From where the technology appears, we picked the bus and we came and followed. We all knew that, you know, some people were considering that you this will be monetized.

Speaker #4: You know, I remember a CEO that there was, you know, betting on it will change the landscape. And many people were considering it. I guess that, at the end of the day, we, we were all, we were all deceived or having a different perspective than the one at the beginning we had.

Speaker #4: On our side, we don't—we didn't change our mind. We said that, you know, 5G, obviously, is a technology. It will take place, like 5G replaces 4G LTE, 4G replaced 3G.

Speaker #4: It's a continuing, continuum, I would say. And from where the, the technology appears, we, we pick the bus and we came and follow. And we all knew that, you know, some people were considering that this will be monetized.

Speaker #4: We all know that it was not monetized. Competition is competition. Pricing is pricing. And the market is not changing in a New York minute.

Pierre Karl Péladeau: We all know that it was not monetized. Competition is competition. Pricing is pricing. The market is not changing in a New York minute. We've been investing steadily without being rushed. We kept our market share. With Freedom Mobile, we continue in the same direction. We think a little bit of the same in terms of satellites. We will continue to look at it, surely, smoothly, without any rush. Certainly, you know, without any doubts.

Speaker #4: So, we've been investing steadily without being rushed. And we kept our market share, and with Freedom Mobile, we continue in the same direction. So we think a little bit of, of, of the same.

Speaker #4: In terms of satellites, we will continue to look at it, surely, smoothly, without any rush. But certainly, you know, without any doubt also.

Hugues Simard: On, Matt, on churn.

Speaker #6: On, Matt, on churn. On churn, just, a couple of comments. we're, we're globally quite pleased, with the evolution of our churn rate. during the quarter.

Pierre Karl Péladeau: Yeah.

Hugues Simard: Just a couple of comments. We're globally quite pleased with the evolution of our churn rate during the quarter. Especially when we look at how we compare with our competitors. We've been more resilient. It's quite obvious that we were more resilient. I think you can see it partly, as you know, higher churn leads to lower ARPU as, you know, people churn out to lower ARPU than they came in with. I think our trajectory on this is continuing to be very good. I think the signs are continuing to be positive on churn. I will just point out to maybe some concerns on Fizz again during the quarter.

Speaker #6: especially when we look at, how we compare with our competitors. we've been more resilient in our, in our, quite, it's quite obvious that we were more resilient.

Speaker #6: And I, I, I think you can see it partly. As you know, higher churn leads to lower RPU. As you know, people churn out to lower RPU than they, than they came in with.

Speaker #6: And I think our trajectory on this is, is, is, is continuing to be very good. So I think the signs are continuing to be positive on churn.

Speaker #6: I will just point out to maybe a, a, a some, we had some concerns on FIZ. Again, during the quarter, and we found out, I'll be honest with you, we found out a bit of an odd situation where we, had, more than a few customers who came to FIZ for, and I'm literally talking about a few hours.

Hugues Simard: We found out, I'll be honest with you, we found out a bit of an odd situation where we had more than a few customers who came to Fizz for, and I'm literally talking about a few hours, to be able, you know what, to get out and benefit from the new customer-only promotions that were out there by our competitors. That's how crazy it was to be honest. You know, a bit of an odd situation, an odd issue on that front. Other than that, we believe that our fundamental, our base business continues with industry low churn. We're quite happy because we think, as I just said, that it bodes very well for our the continuing ARPU trajectory.

Speaker #6: To be able, you know what? To get out and benefit from the new customer-only promotions that were out there by our competitors. So, that's how crazy it was, to be honest.

Speaker #6: So, you know, a bit of an odd, situation and odd issue on that front. But, other than that, we believe that our fundamental, our, our, our base business, continues, with, industry low churn, and we're quite happy because we think, as I just said, that it emotes very well for our, the continuing, RPU, trajectory.

Speaker #6: Okay. And just so that I understand, it sounds like the competitive element in the market was more about the Big Three pulling people from one another, and it doesn't sound like you were experiencing any of their promotions pulling any subscribers to you.

Matthew Griffiths: Okay. Just so that I understand, it sounds like the competitive element in the market was more about the big three pulling people from one another. It doesn't sound like.

Matthew Griffiths: Okay. Just so that I understand, it sounds like the competitive element in the market was more about the big three pulling people from one another. It doesn't sound like you were experiencing any of their promotions pulling any subscribers to you. Were you noticing on the growth add side that that was, if churn was stable then, you know, while there was a lot of switching activity, like growth adds were lower, and that's what resulted.in the year over year decline in net?

Hugues Simard: No

Matthew Griffiths: you were experiencing any of their promotions pulling any subscribers to you. Were you noticing on the growth add side that that was, if churn was stable then, you know, while there was a lot of switching activity, like growth adds were lower, and that's what resulted.

Speaker #6: But were you noticing on the growth ad side that that was—so if churn was stable, then, you know, while there was a lot of switching activity, like, growth ads were lower?

Speaker #6: And that's what resulted in the year-over-year decline in net.

Hugues Simard: Yeah

Matthew Griffiths: in the year over year decline in net?

Speaker #4: Well, yeah. I know we, we said it. I think Jakov said it in his prepared remarks. You know, this was a, this was, a little bit of an unusual quarter.

Hugues Simard: Well, yeah, I know we said it. I think Jacques said it in his prepared remarks. You know, this was.

Hugues Simard: Well, yeah, I know we said it. I think Jacques said it in his prepared remarks. You know, this was a little bit of an unusual quarter, and we thought unnecessarily crazy. Probably sparked by the fact that, as we said, you know, immigration being significantly lower and organic growth being lower, it seemed to have prompted our competitors to launch into things that we just weren't willing to follow on because it just didn't make, as we said, the math didn't work for us. Anyway, let's see how the rest of the year goes. It seems to have calmed down for the moment, but who knows. Let's, you know, keep.

Matthew Griffiths: Yeah

Hugues Simard: This was a little bit of an unusual quarter, and we thought unnecessarily crazy. Probably sparked by the fact that, as we said, you know, immigration being significantly lower and organic growth being lower, it seemed to have prompted our competitors to launch into things that we just weren't willing to follow on because it just didn't make, as we said, the math didn't work for us. Anyway, let's see how the rest of the year goes. It seems to have calmed down for the moment, but who knows. Let's, you know, keep.

Speaker #4: And we thought, unnecessarily, crazy. Probably sparked by the fact that, as we said, you know, immigration being significantly lower and organic growth being lower.

Speaker #4: it seemed to have prompted our competitors to, to launch into things that we, just weren't, willing to follow on because it just didn't make, as we said, the map didn't work for us.

Speaker #4: So, but anyway, let's see how the rest of the year goes. It seems to have calmed down for the moment. But who knows?

Speaker #4: So let's, you know, keep—stay—yeah. Oh, we're, we're, we're certainly gonna stay the course for sure, as Jakov just said. Yeah.

Pierre Karl Péladeau: Stay the course.

Hugues Simard: Say Yeah. We're certainly gonna stay the course for sure, as Jacques just said. Yeah.

Speaker #6: Okay, I appreciate it. Thank you.

Matthew Griffiths: I appreciate it. Thank you.

Speaker #4: Thank you, Matthew.

Pierre Karl Péladeau: Thank you, Matthew.

Speaker #1: Your next question comes from David McFadden with ATB Coremark. Your line is now open.

Operator: Your next question comes from David McFadgen with ATB Cormark. Your line is now open.

Speaker #6: Oh, great. Yeah. so a couple of questions. So just based on your comments earlier in the call, does that mean that maybe FIZ was the biggest contributor of net ads on the wireless side?

David McFadgen: Oh, great. Yeah, a couple of questions. Just based on your comments earlier in the call, does that mean that maybe Fizz was the biggest contributor of net adds on the wireless side?

Hugues Simard: Not necessarily the biggest contributor. I mean, Fizz is, as you know, is on a different, I wouldn't say trajectory, but it's on a different market or pieces of the market. Not necessarily the highest, but it just, it was more prone to, it was facing, steeper, both, you know, ARPU, situation and churn, for some reason. I think all of our brands, especially picking up in the case of Fizz, don't forget that it's starting to pick up very interesting volumes outside of Quebec.

Speaker #4: not necessarily the biggest contributor. I mean, FIZ is a, as you know, is on a different, I would, I wouldn't say trajectory, but it's on a different market or, or pieces of the market.

Speaker #4: so not necessarily the highest, but it, it just, it was more prone to, it was more, it, it was facing, steeper, both, you know, RPU, situation and churn, for some sort, for some, for some reason.

Speaker #4: But, not, I, I, I think, all of our brands, especially picking up on the ca in the case of, of FIZ, don't forget that it's, it's, it's, it's starting to pick up very interesting volumes outside of Quebec.

Speaker #4: Whereas in Quebec, it keeps—it's, it's really a very interesting growth trajectory, which we had, you know, I think I said that last time, and I'll repeat it.

Hugues Simard: Whereas in Quebec it keeps its really very interesting growth trajectory, which we had You know, I think I said that last time, and I'll repeat it. Which is proving that our model was done right. That's the very reason why we launched Fizz was to appeal to what we believed was gonna be the next generation and the new way how people wanted to get wireless and to manage their own accounts on wireless. I think Fizz is responding to these needs and to these wants of the market, and that's why it's continuing to develop very strongly both in Quebec and outside of Quebec.

Speaker #4: which is proving that our model was, was done right. That's the, the very reason why we launched FIZ. was to appeal to what we believed was gonna be the next generation and the new way how people wanted to, to get wireless and to manage their own, their own accounts on, on wireless.

Speaker #4: And I think FIZ is responding to these needs and to these wants of, of the market. And that's why it's continuing to develop very strongly, both in Quebec and outside of Quebec.

Speaker #6: Okay. 'Cause I thought—let's say Ontario—the focus was more freedom. Isn't that still the case? And that's the primary brand that you're trying to grow in Ontario?

David McFadgen: Okay. 'Cause I thought, let's say Ontario, the focus was more Freedom. Isn't that still the case, that that's the primary brand that you're trying to grow?

David McFadgen: Okay. 'Cause I thought, let's say Ontario, the focus was more Freedom. Isn't that still the case, that that's the primary brand that you're trying to grow in Ontario?

David McFadgen: Well-

David McFadgen: in Ontario?

Speaker #4: Yeah. Well, it's both. Yeah. Yeah. What we've talked about, David, is that, of course, we had to be more careful in Ontario with FIZ, as the overlap and the potential cannibalization appeared, you know, more—a little bit more acute for us at the beginning.

Hugues Simard: Well, it's both. What we've talked about, David McFadgen, is that of course we had to be more careful in Ontario with Fizz as the overlap and the potential cannibalization appeared, you know, more a little bit more acute for us at the beginning. We just thought we needed to be a bit more careful. I think what we are actually seeing as we're developing Fizz, and it's now in more than You know, it's in the second if not third gear right now, that we're actually seeing surprisingly low cannibalization between between Freedom and Fizz, which is very good news for us.

Speaker #4: So we just thought we, we needed to be a bit more careful. But I think what we are actually seeing as we're developing FIZ, and it's now, it's now in, in, in more than, you know, it's in the second, if not third, gear right now.

Speaker #4: that we're actually seeing, surprisingly low cannibalization between, between, freedom and FIZ, which is, very good news for us.

Speaker #6: Okay, and then can you comment on just the overall market activity so far in Q2? Just kind of wondering where net ads are gonna show up this quarter, say, versus the prior year quarter.

David McFadgen: Okay. Can you comment on just the overall market activity so far in Q2? Just kind of wondering where net adds are gonna show up this quarter, say, versus the year, the prior year quarter.

Speaker #4: Well, it's, it's mid-May. So there's, the half of the quarter coming in.

Hugues Simard: Well, it's true it's mid-May. There's the half of the quarter coming in. Yeah. Who knows, David? I mean, right now it is, as I said a bit earlier, it seems to be quiet, well, in terms of promotional activity, I mean, or intensity seems to be quieting down. To be honest, on the other side of the equation, are we really seeing increased market growth? Not really. There are still pockets of, you know, crazy offers in the market. You know what? Who knows? It's I think it's a bit early to call the quarter at this point.

Speaker #6: Yeah. Who knows, David? I mean, right now, it, it, it is, as I said a bit earlier, it's, it, it seems to be quiet—well, in, in, in terms of promotional activity, I mean, or intensity.

Speaker #6: Seems to be quietening down. To be honest, on the other side of the equation, are we really seeing increased market growth? Not really. And there are still pockets of, you know, crazy offers in the market.

Speaker #6: So, y-you know what? Who knows? It's, I think it's a bit early to, to call the, the quarter at this point. Okay. And then, and then lastly, just on the stock buyback.

David McFadgen: Okay. Lastly, just on the stock buyback. You know, you're obviously active in the quarter, and you've increased your NCIB up to 7 million shares. Are there any sort of parameters where you'd be more active or less active in the market?

Speaker #6: So, you know, you're obviously active in the, in the quarter, and you've increased your, your NCIB up to 7 million shares. Are there any sort of parameters where you'd be more active or less active in the market?

Speaker #4: Well, we're, you know, we're kind of staying the course on that one as well, David, to be honest. We believe that it makes sense for us, to continue, a-at a reasonable level, at a balanced, disciplined level.

Hugues Simard: Well, we're, you know, we're kinda staying the course on that one as well, David, to be honest. We believe that it makes sense for us to continue at a reasonable level, at a balanced, disciplined level. I mean, it's not as if we're buying crazy amounts of shares as you see. We believe we're at the right level and certainly intend to continue at this point. As we've said in the past, it's something we can flex quite easily. At this point, it makes sense for us to continue on that path.

Speaker #4: I mean, it's not as if we're, we're buying, crazy amounts of, of shares, as you, as, as you see. we believe we've, we're on the right level.

Speaker #4: And certainly intend to continue with this point. As we've said in the past, it's, it's something we can flex quite easily. But at this point, it's, it makes sense for us to continue on that path.

Speaker #6: Okay. All right. Thank you.

David McFadgen: Okay. All right. Thank you.

Speaker #1: Your next question.

Hugues Simard: Thank you, David.

Speaker #4: Thank you, David.

Speaker #1: Comes from your next question comes from Mayor Yagi, Wisconsin Bank. Your line is now open.

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

Maher Yaghi: Parfait. Merci d'avoir pris mes questions. I wanted to ask you, Hugues, you mentioned that the lower loading in the quarter was mostly due to gross loading being down year-on-year, not really a churn issue that your peers had problems with. If I look at your top line, obviously you're growing very fast, helped by a lot of loading that you did over the last 2 years. As we look forward, you know, if, you know, how should we think about your wireless revenue growth rate in a time when subscriber loading, which you've been relying on to grow, is slowing down? Do you think that we need to start to see ARPU actually improve from here to offset that lower growth in subscribers?

Speaker #3: Parfait. Merci d'avoir pris mes questions. I wanted to ask you, so, so Hugues, you mentioned that the lower loading in the quarter was mostly due to gross loading being down year-on-year, not really a churn issue that your peers have had problems with.

Speaker #3: Now, if I look at your top line, obviously you're growing very fast, helped by a lot of loading that you did over the last two years.

Speaker #3: as we look forward, you know, if, you know, how, how should we think about your wireless revenue growth rate, in, in, in a time when subscriber loading, which you've been relying on to grow, is slowing down?

Speaker #3: Do you think that we need to start to see our pool actually improve from here to offset that lower growth in subscribers? Or is it hard to, you know, expect in the current environment that we're in, in Canada right now?

Maher Yaghi: That is hard to, you know, expect in the current environment that we're in in Canada right now?

Speaker #4: Well, it's—you know—that's a tough one to call, Mayor. But, before I get there, just to your first point, I just want to make sure I don't forget to address your first point.

Hugues Simard: Well, it's You know, that's a tough one to call, Mary. Before I get there, just to your first point, I just wanna make sure I don't forget to address your first point. I mean, we didn't necessarily say I mean, we went through the same We, you know, we live the same quarter as our competitors. We're not saying it was all about gross loading coming down. I mean, churn was up. And so I'm not, you know, just to make clear, I mean, it was part of both for sure in terms of loading and churn. Back to your question, you know, it is something that, you know, ARPU, the ARPU keeps increasing.

Speaker #4: I mean, w-we didn't necessarily say—I mean, we, we went through the same, we, you know, we lived the same quarter as our competitors.

Speaker #4: We're not saying it was all about gross loading coming down. I mean, churn was up. And so, I'm not—you know, just to make clear—I mean, it was part of both, for sure, in terms of loading and churn.

Speaker #4: but back to your question, sh you know, it's, we, i-i-it's, i-i-it is something that, you know, our view, the, the, the our, our view keeps increasing.

Speaker #4: I mean, we, we are definitely, yeah, I agree with your statement that we are living through right now the, the higher, the, the benefits in, in terms of our view of the higher loading at the right prices that we, that we saw in the past few quarters.

Hugues Simard: I mean, we are definitely. Yeah, I agree with your statement that we are living through right now the higher the benefits in terms of our view of the higher loading at the right prices that we saw in the past few quarters. I think you will agree that we haven't changed our strategy and we're continuing to grow at different volumes, maybe lower net adds, and maybe net adds continue to slope down a little bit. If, you know, if you're doing it at the right price, then nothing prevents our view. On the contrary, our view should continue to improve positively.

Speaker #4: But, I think you will agree that we haven't changed our strategy, and we're continuing to grow at different volumes—maybe lower net ads—and maybe net ads continue to slope down a little bit.

Speaker #4: But if, if, you know, if you're doing it at the right price, then nothing prevents our view. On the contrary, our view should continue to improve positively.

Speaker #4: So.

Speaker #3: Let me ask you another way. M-maybe let, let me ask it another way. you know, y-you've been relying on a very fast revenue growth in mobile, you know, right in this quarter, you, you, you, you reported 9% revenue growth in mobility, which is really phenomenal.

Maher Yaghi: Let me ask it another way. You know, you've been relying on a very fast revenue growth in mobile. You know, right in this quarter, you reported 9% revenue growth in mobility, which is really phenomenal.

Speaker #4: Yep.

Speaker #3: Eight percent or 7.5% of that is on subscriber growth. As a company, do you see yourself accepting that this growth might come down into the 4% or 5% range?

Hugues Simard: Yes, yes.

Maher Yaghi: 8% or 7.5% of that is on subscriber growth. Are you as a company, do you see yourself accepting that this growth might come down into the 4%, 5% range because the overall subscriber growth in Canada is slowing down and it's hard to extract yourself from that environment? As a company, Do you accept that you can live with a 4% to 5% mobile telephony revenue growth, or you need to continue to post those kind of growth rates to offset the pressure that you're seeing on the cable side? That's really my the question I'm trying to figure out.

Speaker #3: Because the overall subscriber growth in Canada is slowing down, and it's hard to extract yourself from that environment. As a company, do you accept that you can live with a 4 to 5 percent mobile telephony revenue growth, or do you need to continue to post those kinds of growth rates to offset the pressure that you're seeing on the cable side?

Speaker #3: That's really my—my question I'm trying to figure out.

Speaker #4: You know, Mayor, Pierre Cal said it well, I think, in his remarks. We're about the bottom line and the cash flow at the end of the day.

Hugues Simard: You know, Maher, Pierre-Carl said it well, I think, in his remarks. We're about the bottom line and the cash flow at the end of the day. That's why we said in Q1, our Is it a problem for us to have gone from 52.9 to 28.8? No. To be honest, we think we made the right call because the 28.8 is at the right price, which still allows us to continue to improve our view and cash flow as we continue to lower our cost base and increase our cash flow generation. You know, I don't think we're managing. I think maybe the disconnect between what you're saying is we're not managing the company according to what you're saying.

Speaker #4: And that's why we said, in Q1, our, our, our i-is, is it a problem for us to have gone from 52.9 to 28.8? no, to be honest, we think we made the right call because the 28.8 is at the right price, which still allows us to continue to improve our view.

Speaker #4: And cash flow, as we continue to lower our cost base and, and, and increase our, our cash flow generation. So, you know, I, I, I don't think we're managing—I, I, I think may—maybe the disconnect between what you're saying is, is we're not managing the company according to what you're saying.

Speaker #4: I mean, we're not looking for a, a, a percentage growth to make up or to, to counter or to, to help the fact that on a lower number, we may be expecting on the, on the wireline side.

Hugues Simard: I mean, we're not looking for a percentage growth to make up or to counter or to help the fact that on a lower number we may be expecting on the wireline side. You know, that's not how we unbundle. We look at each business separately to maximize profitability and ultimately cash flow on both sides. Work on the cost structure on both sides independently and have our pricing strategies on both sides independently, you know, to maximize. We're adjusting all the time these strategies and these packages. As Pierre-Carl said, you know, we keep innovating, we keep coming up with things that people are looking for or will be willing to pay for.

Speaker #4: You know, that's not how we—on both—we look at each business separately, to maximize profitability and ultimately cash flow on both sides.

Speaker #4: And work on the cost structure on both sides independently, and have our pricing strategies on both sides independently. You know, to maximize, we're adjusting all the time, these strategies and these packages. As Pierre Cal said, you know, we keep innovating, we keep coming up with things that people are looking for or will be willing to pay for.

Hugues Simard: I mean, we're not at all, to be honest, looking at it in terms of percentage to make up for potentially, you know, lower growth on the other side of the business. We're really driving and being very, very granular in our pricing strategies, whether it's wireless and within wireless, depending on the brand, and also, in wireline. Does that, I don't know if I'm making myself very clear?

Speaker #4: So it's not—I mean, w-we're, we're not at all, to be honest, looking at it in terms of percentage to make up for potentially, you know, lower growth on the other side of the business.

Speaker #4: It, i-it really w-we're really driving and, and being very, very granular in our, pricing strategies, whether it's wireless a-and, and within wireless, depending on the brand, and also on in, in wireline.

Speaker #4: Does that I don't know if I'm making myself very clear, but.

Speaker #3: No, no, that—that's very clear. Thank you. Thank you for that. And maybe just a question on wholesale tariffs—you know, since we discussed on a C Open call last time, we were still waiting for the final tariffs to come out.

Maher Yaghi: Yeah. No, no. That's very clear. Thank you. Thank you for that. Maybe just a question on wholesale tariffs. You know, since we discussed on open call last time, we were still waiting for the final tariffs to come out on wholesale internet wholesale. We have now the final tariffs. Can you update us on your strategy to bundle internet with wireless outside of Quebec under the current tariffs that now we know what they will be going forward?

Speaker #3: On, on, wholesale, internet, internet wholesale, w-we have now the final tariffs. Can you update us on your strategy to bundle internet with wireless outside of Quebec?

Speaker #3: Under the current tariffs that now we know what they will be going forward.

Speaker #4: I would say, you know, well, the first thing is that, you know, we're also looking for the, the other, co-acts, pricing.

Hugues Simard: I would say, you know, Well, the first thing is that, you know, we're also looking for the other, coax pricing.

Speaker #3: Exactly. That's exactly right.

Maher Yaghi: That's right. That's exactly right.

Hugues Simard: Yeah, obviously, you know, we can say that, you know, we were not where we were looking to be. Does that mean that, you know, we are confined, I would say, to not being able to bundle? The answer would be no. We're gonna look at it. We will continue to do it. We will finesse, I would say, our proposal. It's something that is not completely crazy. Is it completely interesting? Not much. It's balanced with the coax. Something that we find pretty strange is that there are different prices depending the region where you operate. You're in the western side, cost of using others people network is more expensive than in the east side. It just makes-

Speaker #4: And, you know, obviously, you know, we can say that, you know, we were not where we were looking to be. Does that mean that, you know, we are confined, I would say, to not being able to bundle?

Speaker #4: the answer would be no. We're gonna look at it. We will continue to do it. we will finesse, I would say, our proposal. It's something that it's not completely crazy.

Speaker #4: Is it completely interesting? Not much. So, it's balanced with the co-acts. And something that we find pretty strange is that there are different prices depending on the region where you operate.

Speaker #4: So you're in the western side, cost of using others' people network is more expensive. Then in the east side, so it just makes westerners in Canada not being able, you know, to enjoy the most competitive environment.

Pierre Karl Péladeau: Westerners in Canada, not being able, you know, to enjoy the most competitive environment, this was not really explained by the CRTC, and we're still asking ourselves why.

Speaker #4: And this was not really explained by the CRTC, and we're still asking ourselves why.

Speaker #3: So, as we stand right now, should we expect to see you be more active selling bundled services outside of, let's say, Ontario, Quebec—in the West?

Maher Yaghi: As we stand right now, should we expect to see you be more active selling bundled services outside of, let's say, Ontario, Quebec, and the West? Do you have the agreements in place to be competitive selling a bundled product outside Quebec right now?

Speaker #3: or do you have the agreements in place to be competitive selling a bundled product outside Quebec right now?

Speaker #4: Well, th-there, where you're going, Mayor, is it a little bit too much? I mean, you will understand that we're—we're not gonna, you know, publicly an-announce or present our commercial strategies.

Pierre Karl Péladeau: Well, where you're going, Maher, is a little bit too much. I mean, you will understand that we're not gonna, you know, publicly announce or present our commercial strategies.

Speaker #4: And I guess the little you'll see in the, in the, in the next quarters.

Maher Yaghi: Okay.

Pierre Karl Péladeau: you'll see in the next quarters.

Speaker #3: That's fair enough.

Maher Yaghi: That's fair enough.

Pierre Karl Péladeau: Sorry about it.

Speaker #4: Sorry about it.

Speaker #3: No, no. Merci beaucoup.

Maher Yaghi: No, no. Merci beaucoup.

Pierre Karl Péladeau: Please. Thank you, Maher.

Speaker #4: Please. Thank you, Mayor.

Maher Yaghi: Back.

Speaker #1: 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.

Speaker #5: Hi, good afternoon. Internet service revenue growth of 3% was strong in the quarter. It looks like it was primarily driven by pricing. I hope you can talk a little bit about the competitive internet environment in Quebec.

Stephanie Price: Hi, good afternoon. Internet service revenue growth of 3% was strong in the quarter. It looks like it was primarily driven by pricing. Hopefully, you can talk a little bit about the competitive internet environment in Quebec and maybe touch on bundling your thoughts of rest of Canada internet expansion as well.

Speaker #5: And maybe touch on bundling—your thoughts on rest-of-Canada internet expansion as well.

Hugues Simard: Yeah. Internet was, internet revenue growth was in good part driven by price increases. We've discussed that and we certainly own up to that. The general competitive situation in Quebec in broadband has improved and is a lot more rational, I would say, than what we've known over the past years, you know. I think it's clearly showing in our numbers that we There again, we're not looking for crazy growth. We're looking for profitable growth. You know, our strategies are pretty simple. We You know, we tend to use the same ones. In the past, when Bell was crazy, pricing broadband in Quebec, you will remember that we did not follow for the most part.

Speaker #4: yeah. Internet was internet revenue growth was in good part driven by price increases. we've, we've, we've discussed that. And, we certainly own up to that.

Speaker #4: But the general competitive situation in, in Quebec, in broadband, has, has improved. And, i-is a lot more rational, I would say. than what we've than what we've known over the past years, you know.

Speaker #4: And I think it's, it's, it's clearly showing in our numbers. That, we—there again, we're not looking for crazy growth. We're looking for profitable growth.

Speaker #4: And, you know, our strategies are pretty simple. We, you know, we tend to use the same ones. And, in the past, when Bell was crazy, pricing broadband in Quebec, you will remember that we did not follow, for the most part.

Hugues Simard: You know, did we pay a bit of a market share price? Yeah, probably we did. Actually, we did. We reestablished the situation and our revenue situation is way better. You know, as I said, partly helped for sure by the price increases. We're actually, you know, quite bullish on this. We believe that the state of the market right now is good. Our internet service revenue performance and even stability in terms of loading was positive for us this quarter. Well, you know, it all depends, of course, how the situation evolved, the competitive situation evolves. Right now it's looking pretty, you know, pretty positive and pretty encouraging.

Speaker #4: You know, did we pay a bit of a market share price? Yeah, probably we did. And actually, we did. But our— but we re-established the situation, and our revenue situation is way better.

Speaker #4: And, and, and, you know, as I said, partly helped, for sure, by the price increases. But we're, we're actually, you know, quite, quite bullish on this.

Speaker #4: We believe that the state of the market right now is good. And our internet service revenue performance, and even stability in terms of loading, was positive for us this quarter.

Speaker #4: And we, well, you know, it all depends, of course, how the situation evolves, the competitive situation evolves. But right now, it's looking pretty, you know, pretty positive.

Speaker #4: And pretty encouraging.

Speaker #6: As you know, Stéphanie, you know, Bell was our competitor there. Was, you know, the last telco operator, you know, to invest in fiber.

Pierre Karl Péladeau: As you know, Stephanie, you know, Bell was our competitor there, the last telco operator, you know, to invest in fiber. They did it. They invested significantly, hundreds of CAD million. You know, they were looking for results. If not, you know, their strategy would be a complete failure. They went and very aggressively, you know, proposing pricing and splash over the place, you know, the supposed-to-be better technology. They forgot a significant thing, which is the customer service. We've been there, we deliver, and this is tough to beat. Now I guess that after, you know, all the noise they made, and we should say also our own improvement in terms of network. Were we behind?

Speaker #6: So they did it. they invested a significantly, hundreds of million dollars. So you know, they were looking for results. If not, you know, their, their strategy would be a, a completely a complete failure.

Speaker #6: So they, they, they went and very aggressively, you know, proposing pricing and splash over the place, you know, the supposed-to-be better technology.

Speaker #6: But they forgot a significant thing, which is the customer service. We've been there with Delivered, and this is tough to be. But now, I guess that after, you know, all the noise they made—and we should say also our own improvement in terms of network.

Speaker #6: Were we behind? Maybe we were in certain areas. But we are just compensating now with additional investment and making sure that we'll be able to match any source of technology that our competitor is deploying.

Pierre Karl Péladeau: Maybe we were in certain areas, but we are just compensating now with additional investment and making sure that we will be able to match any sorts of technology that our competitor is deploying. This is also a matter of looking forward more favorably for the future, because they know that if they were to come and getting crazier on their pricing, they will not achieve anything. In fact, they will probably achieve a repricing feature like the one they faced with their wireless business.

Speaker #6: So this is also a matter of looking forward more favorably for the future because they know that if there weren't come to come and getting crazier on their pricing, they will not achieve anything.

Speaker #6: In fact, they will probably achieve a repricing feature like the one they faced with their wireless business.

Speaker #1: Thanks for the color. Maybe I'll just ask one more follow-up. Just on the call, you mentioned a move into B2B technology services in English Canada.

Stephanie Price: Thanks for the color. Maybe I'll just ask one more follow-up. Just on the call, you mentioned a move into B2B technology services in English Canada. Just curious how you think about the pace of that rollout, and if you've got the talent and the infrastructure, et cetera, in place at this point.

Speaker #1: Just curious how you think about the pace of that rollout, and if you've got the talent and the infrastructure, etc., in place at this point.

Pierre Karl Péladeau: Well, Stephanie, you know, we're not the kind of organization to which is the flavor of the month, you know. We've been looking at our competitors. We're very strong on this. It's, I would say in Italian, you know, "Che va sano va piano, che va piano va lontano." It means that, you know, going slowly but surely and surely very long. We're starting there. As you know, Videotron service acquired started 20 years ago, and right now is a very strong competitor to other businesses servicing operators like Bell is not the only one. We have Rogers, we have Telus in certain areas. We follow the course there also, we stay the course, we've been doing well. We also have the IoT segment, which is of great interest also.

Speaker #4: well, Stephanie, you know, we're not the kind of organiz-organization to. Which is the flavor of the month, you know. we've been looking, at our competitors.

Speaker #4: We're very strong on this. So, I would say in Italian, you know, 'Give us a nuova piano. Che va piano va lontano.' So it means that, you know, going slowly but surely—and surely very long.

Speaker #4: So we're starting there. As you know, we do trans service affaires started 20 years ago. And we're right now is a very strong competitor to other businesses, servicing operators, like Bell.

Speaker #4: But Bell's not the only one. We have Rogers, and we have Dallas in certain areas. And we follow the course there also. We stay the course.

Speaker #4: And we've been doing well. We also have the IoT segment, which is of great interest also. Obviously, the pricing is completely different, as you know.

Pierre Karl Péladeau: Obviously, the pricing is completely different, as you know, but it's certainly a business of the future, where we acquired expertise in terms of technology, in terms of sales, craftsmanship. So we will continue slowly in this direction and move forward with a reasonable growth.

Speaker #4: But it's certainly a business of the future, where we acquired expertise in terms of technology, in terms of sales, craftsmanship. And so, we will continue slowly in this direction and move forward with a reasonable growth.

Speaker #1: Thank you very much.

Stephanie Price: Thank you very much.

Speaker #4: Pleasure, Stephanie.

Pierre Karl Péladeau: Pleasure, Stephanie.

Speaker #1: Your next question comes from Jérôme Dubreuil with Desjardins. Your line is now open.

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

Speaker #3: Bonjour tout le monde. Thanks for taking my questions. the first one is on strategy. I mean, we do see a very long runway of growth there.

Jerome Dubreuil: Hello, both of you. Thanks for taking my questions. First one is on strategy. I mean, we do see a very long run with growth there. I'm wondering if you think that Quebecor is set strategically for a long time, or if you think there are kind of missing blocks or you're happy just to be I mean, not just, but to be taking more market share and pricing going forward.

Speaker #3: but I'm wondering if you think that Quebecor is, is set strategically, for a long time or, or if you think there are kind of missing blocks or you're, you're happy just to be I mean, not just, but to be taking more market share in, in pricing going forward.

Speaker #6: I, I guess, Jérôme, I feel that I repeat myself. I guess my line today is, stay the course. Which doesn't seem to be a, a, you know, a, a bad strategy.

Pierre Karl Péladeau: I guess, Jerome Dubreuil, I feel that I repeat myself. I guess my life today is stay the course, which doesn't seem to be, you know, a bad strategy. If it ain't broke, don't fix it. We look forward to continue what we've been able, you know, to achieve. We'll see what the future is all about in terms of other opportunities. If we were to stay, you know, on our regular course, we would continue of doing, you know, what we've been doing in the past. I don't know. You know, I'm not gonna announce that we're investing billions of dollar in a AI, you know, data center. We think that our business, you know, it is open for growth.

Speaker #4: Yeah.

Speaker #6: if it's in growth, don't fix it. and we look forward to continue what we've been able, you know, to achieve. we'll see what the future i-is all about in terms of other opportunities.

Speaker #6: But, i-if we were to stay, you know, on our regular course, we would continue o-of doing, you know, what we've been doing in the past.

Speaker #6: So, I—I don't know. You know, I'm not gonna announce that we're investing billions of dollars in a AI, you know, data center; we think that our business, you know, i-is open for growth.

Speaker #6: So, this is certainly, you know, what we think we should do. And we're trying to do it as, as, as best as possible.

Pierre Karl Péladeau: This is certainly, you know, what we think we should do, and we're trying to do it as best as possible.

Speaker #4: Yeah. No, that works. telco investors like, predictability for sure. second one, your, your generating quite a bit of cash, even though it's growing, your leverage is below target.

Jerome Dubreuil: Yeah. No, that works. telco investors like predictability for sure. second one, you're generating quite a bit of cash. EBITDA is growing. Your leverage is below target. If I'm taking the 2 million additional shares that you're looking to buy back in the next 3 months, before the program expires, and at current share price, I get an annualized spending of about CAD 480 million of buybacks annually. Is this a level we should be expecting for the next year or so if we're strategically set and we're happy with the leverage right now or maybe even more than CAD 500 million buybacks?

Speaker #4: If I'm taking the 2 million additional shares that you're looking to buy back in the next three months, before the program expires, and at, at current share price, I get, an annualized spending of about $480 million of buybacks annually.

Speaker #4: Is this a level we should be expecting for the next year or so if we're strategically set and we're happy with the leverage right now?

Speaker #4: Or maybe even more than $500 million in buybacks?

Speaker #6: Well, you know, we're working for the shareholders. And we believe that the best way shareholders could be served is by balancing, you know, our, the, the usage of the free cash flow that we're generating.

Pierre Karl Péladeau: You know, we're working for the shareholders. We believe that the best way shareholders could be served is by balancing, you know, the usage of the free cash flow that we're generating. You know, it's easy to understand. Reduce debt, buy back shares, and pay dividend. There's a decent or reasonable balance between those three items. Maybe, you know, the next question you'll tell me is that what are you gonna do when you're not gonna have debt anymore?

Speaker #6: And, you know, it’s easy to understand: reduce debt, buy back shares, and pay dividend. There’s a decent or reasonable balance between those three items.

Speaker #6: maybe you know, the next the next question, what you, you'll, you'll tell me is that what are you gonna do when you're not gonna have debt anymore?

Hugues Simard: There's still some there.

Speaker #4: There's still something.

Pierre Karl Péladeau: Yeah.

Speaker #6: Yeah, there's still something to go there.

Hugues Simard: Not there yet.

Pierre Karl Péladeau: to go there.

Speaker #4: Not there yet.

Hugues Simard: Not there yet.

Speaker #6: Not there yet.

Pierre Karl Péladeau: Not there yet.

Speaker #4: Unfortunately not.

Hugues Simard: Unfortunately not.

Pierre Karl Péladeau: This is why I guess that, you know, the balance between the three components are still, you know, the course that we will follow.

Speaker #6: So this is why I guess that, you know, the, the, the balance between the three components are, are still, you know, the, the course that we will follow.

Pierre Karl Péladeau: This is why I guess that, you know, the balance between the three components are still, you know, the course that we will follow.

Speaker #3: Yeah, correct. And maybe, maybe a last one for you. You said earlier on the call—I think I understood—you said that FIS is taking advantage of high competition.

Jerome Dubreuil: Okay, great. Maybe a last one for Hugues Simard. Hugues Simard, you said earlier on the call I think I understood you said that, Fizz is taking advantage of high competition. I'm wondering what that means exactly. Is it that people see good pricing out there, they start shopping around and ultimately choose Fizz or is that what you meant?

Speaker #3: I'm wondering what, what that means exactly. Is that is it that people see good pro good pricing out there? They start shopping around and ultimately, choose FIS?

Speaker #3: Or is that what you meant?

Speaker #4: Well, well, what I meant is what we've said before, Jérôme, is to optimize the positioning of our o-of our brands. you know, and to, to, to, to position as, as, as best we can.

Hugues Simard: Well, what I meant is what we've said before, Jerome, is to optimize the positioning of our brands. You know, to position as best we can, as we've done in Quebec between Videotron and Fizz. You know, the difference in Ontario and the West is that it's we're starting from a blank page for Fizz, so that's a huge opportunity for us and allows us to be maybe, as I said, a bit more aggressive in certain cases to make sure that we position it versus freedom as optimally as possible. That's basically what I meant.

Speaker #4: As we've done in Quebec between Videotron, and FIS, you know, the difference in, in Ontario and the West is that it's we're starting from a blank page.

Speaker #4: for FIS. So that's a huge opportunity for us. And allows us to be maybe, as I said, a, a bit, a bit more aggressive in, in certain cases to make sure that we, we position it, f-versus Freedom as, as optimally as, as possible.

Speaker #4: That's, that's basically what I meant.

Speaker #3: Merci beaucoup.

Jerome Dubreuil: Merci beaucoup.

Pierre Karl Péladeau: Merci, Jerome. I think it's our last question, operator.

Speaker #6: Merci, Jérôme. I think it's our last question, Operator.

Speaker #1: Yes. Your next question comes from Vince Valentini with TD Cowan. Your line is now open.

Operator: Yes. Your next question comes from Vince Valentini with TD Cowen.

Speaker #3: Hey, thanks very much. the CapEx on building out new wireless territories such as Manitoba, where I think you've already started, so that you can wean off of the MVNO, regime.

Vince Valentini: Hey, thanks very much. The CapEx on building out new wireless territory such as Manitoba, where I think you've already started, so that you can wean off of the MVNO regime. Can you update us on that at all as to how much you've spent already and what are you still planning to accelerate that investment over the next several quarters? If there's any update on how long to finish off Manitoba, that'd be great.

Speaker #3: Can you update us on that at all? Is to how much you've spent already and, and what are you still planning to accelerate that investment over the next several quarters and i-if there's any update on how long to, to finish off Manitoba?

Speaker #3: That'd be great.

Hugues Simard: Hi, Vince. In Manitoba, you know, it's not gonna be a huge program, to be honest. We are at the early stages. Yes, there's been some CapEx in Manitoba, but it's, to be honest, it hasn't been huge yet. We definitely intend to continue, and it's continuing as we speak, just for the very reason that you mentioned, you know, to wean off the MVNO as quickly as possible. It's a market, as I just said, where we believe we can do it fairly quickly, by putting on a limited number of sites and being able to then be on our own. It's progressing.

Speaker #4: hi, Vince. in Manitoba, you know, it's, it's gonna be it's not gonna be a huge program to be to be honest. And, we are a-at the early stages.

Speaker #4: So yes, there's been some CapEx in Manitoba, but to be honest, it hasn't been, it hasn't been huge yet. And we definitely intend to continue.

Speaker #4: And it's continuing as we speak. just for the very reason that you mentioned, you know, to wean off the, the MVNO as, as quickly as possible.

Speaker #4: And it's a market, as I just said, where we believe we can do it fairly quickly by putting on a limited number of sites.

Speaker #4: And being able to then be on our own. So it's, it's progressing. i-it, it will ramp up, in the next, in the next few quarters.

Hugues Simard: It will ramp up in the next few quarters, but, you know, still early stages.

Speaker #4: But, you know, still early stages.

Speaker #3: So, moving the traffic to your own network from the MVNO partner is not something that's gonna happen this calendar year?

Vince Valentini: Moving the traffic to your own network from the MVNO partner is not something that is going to happen this calendar year?

Pierre Karl Péladeau: By certain ease of it.

Pierre Karl Péladeau: By certain ease of it.Build our network.

Speaker #6: I certain ease of it?

Hugues Simard: Yeah. Yeah.

Speaker #4: Yeah, yeah. I know, exactly. Yeah, absolutely. It's—it's gonna be gradual, and towards the end of the year, probably.

Pierre Karl Péladeau: Build our network.

Hugues Simard: Exactly. Yeah. Absolutely. It's gonna be gradual and towards the end of the year, probably.

Speaker #3: Okay. And also wholesale just. Yeah. Go ahead.

Vince Valentini: Okay. Also wholesale.

Hugues Simard: And then-

Vince Valentini: Yeah, go ahead.

Speaker #4: No. And then, going on over the next, you know, the next year or so.

Hugues Simard: No, going on over the next, you know, the next year or so.

Speaker #3: Okay. A-also on wholesale j-to clarify, y-you resell internet across the country now. And you obviously have been marketing Freedom Internet Service outside of Quebec.

Vince Valentini: Okay. Also on wholesale, just to clarify, you resell internet across the country now, and you obviously have been marketing Freedom Internet service outside of Quebec. Is that not almost entirely on cable networks and taking advantage of the cable TPIA rates as opposed to the more recent fiber TPIA rates?

Speaker #3: I-is that not almost entirely on cable networks and taking advantage of the cable TPIA rates as opposed to the more recent fiber TPIA rates?

Speaker #4: Yes. Absolutely. Yep.

Hugues Simard: Yes, absolutely. Yeah.

Speaker #6: As we do this also in Quebec, territory. On Quebec footprint, where we do not operate as an incumbent. you can think of Cogeco. As Cogeco also, you know, use our the, the MVNO program, you know, to, to use our eventually our mobile network.

Pierre Karl Péladeau: As we do this also in Quebec territory.

Hugues Simard: Yeah.

Pierre Karl Péladeau: On Quebec footprint where we do not operate as an incumbent. You can think of Cogeco. At Cogeco also, you know, use our the MVNO program, you know, to use our eventually our mobile network. It's true on every piece of the footprint in the Canadian landscape.

Speaker #6: So, i-it's true o-on every piece of, of the footprint in, in the Canadian landscape.

Speaker #3: Okay.

Vince Valentini: Okay.

Speaker #4: Yeah. And, and just one comment. I mean, the, the, the, the obvious reason is because rates on coax are lower as be as, as I believe Capcom mentioned earlier, still with this.

Hugues Simard: Yeah. Just one comment. I mean, the obvious reason is because rates on coax are lower, as Jacques, as I believe Jacques had mentioned earlier. With this.

Speaker #6: At this stage. And the price is not there yet.

Pierre Karl Péladeau: At this stage, we don't know.

Hugues Simard: At this stage, and we don't know.

Pierre Karl Péladeau: Final price is not there yet.

Speaker #4: And the price yeah. The we, we haven't had a, a price yet. But, but it and I-I'm you know, in, in our view, it does not make sense that, you know, that coax should be lower.

Hugues Simard: The price, yeah, we haven't had a price yet. In our view, it does not make sense that, you know, that coax should be lower. Let's wait and see what, where prices end up being. Certainly, and we've said this publicly many times, in our view, it should be the same price no matter what technology or platform or whatever you call it, whether it's cable or FTTH. Let's see where that comes out and before being able to see if it's an opportunity or a threat or both, you know.

Speaker #4: So let's wait and see what where prices end up being. But certainly and we've said this publicly many times. In our view, it should be the same price no matter what technology or, or platform or whatever you call it, whether it's cable or, or FTTH.

Speaker #4: But, let's see where that comes out. And before being able to see if it's an opportunity or a threat, or both, you know.

Speaker #3: And last sub-question on that, didn't you had do you guys have any visibility as to when the CRTC may set some new cable TPIA rates?

Vince Valentini: Last sub-question on that then, Hugues. Do you guys have any visibility as to when the CRTC may set some new cable TPIA rates?

Pierre Karl Péladeau: Oh. That's the billion-dollar question. We never know.

Speaker #6: Oh, that-that's the billion-dollar question. We never know.

Speaker #3: Nothing coming imminently as far as you're aware? Is that fair?

Vince Valentini: Nothing coming imminently as far as you're aware. Is that fair?

Speaker #6: Well, I we can't we can't answer because, you know, we, we don't know. We, we do not have any signals. it comes when it comes.

Pierre Karl Péladeau: We can't answer because, you know, we don't know. We do not have any signals. It comes when it comes or it stays when it stays. We're still waiting, I guess, you know, for decisions that we've been asking 2 years ago. We've been used with that kind of regime.

Speaker #6: Or it stays it's when it stays, and we're still waiting, I guess, you know, for a decision that, we've been asking two years ago.

Speaker #6: So we-we've been used with that kind of regime.

Speaker #3: Fair enough. Thank you very much.

Vince Valentini: Fair enough. Thank you very much.

Speaker #6: Thank you very much, Vince. So, to all of you would like, you know, to thank you for attending this conference call. And, we'll be there next quarter.

Pierre Karl Péladeau: Thank you very much, Vince. To all of you, we'd like, you know, to thank you attending this conference call, and we'll be there next quarter. Thank you very much, and have a good afternoon.

Speaker #6: Thank you very much, and have a good afternoon.

Speaker #1: Ladies and gentlemen, this concludes the Quebecor Inc.'s financial results for the first quarter 2026 conference call. Thank you for your participation and have a nice day.

Operator: Ladies and gentlemen, this concludes the Quebecor Inc.'s financial results for the Q1 2026 conference call. Thank you for your participation, and have a nice day.