TELUS Corp. (TU) is a leading telecom operator in Canada. The company operates in two segments, Wireless and Wireline. TELUS provides a range of telecom products and services including wireless and wireline voice and data services, video, hosting, managed information technology, cloud-based services, and business process outsourcing solutions.
TELUS stole the show in Canada’s latest wireless spectrum auction for the sale of 2.5 GHz airwaves to be used for smartphones and other mobile devices. The company shelled out C$478.82 million for 122 licenses in the 2.5 GHz band. We expect continuous acquisition of spectrum to enhance the company’s market share and drive revenues and subscriber gain, going ahead.
Moreover, strong prospects in the Wireless segment, the company’s investments in cloud-based offerings and Internet of Things (IoT) marketplace are certain factors that are likely to impact the quarter favorably.
On the flip side, heightened wireless competition, the Canadian government’s new wireless policy, increasing prepaid subscriber churn, continuous loss of local access lines and a highly leveraged balance sheet might continue to weigh on the to-be-reported quarter’s performance.
TELUS currently carries a Zacks Rank #4 (Sell). The company has generated positive average earnings surprise of 1.51% in last four successive quarters. We have highlighted some of the key stats from this just-revealed announcement below:
Earnings: TELUS Beats Q2 earnings estimate. Our consensus earnings estimate called for an adjusted EPS of 51 cents while the company reported adjusted EPS was 54 cents. Investors should note that these figures take out stock option expenses.
Revenue: TELUS reported total revenue of $2,522.2 million surpassing our estimate of $2,454 million.
Key States to Note: Net wireless subscriber addition in the reported quarter was 63,000, up 28.6% year over year. Postpaid customer net addition was 76,000, down 2.6% year over year. TELUS lost 13,000 prepaid customers in the second quarter against a loss of 29,000 in the year-ago quarter. During the reported quarter, TELUS added 17,000 TV subscribers, down 26.1% year-over-year and also added 22,000 High-speed Internet subscribers, up by a substantial 46.7% year over year.
Check back later for our full write up on this TELUS earnings report later!
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