Rogers Communications (TSX: RCI.B) reported its Q2 2025 earnings this week, toplined by a 2% YoY revenue increase to $5.22 billion and a 5% sequential lift from Q1’s $4.98 billion.
However, profitability deteriorated sharply: net income fell 62% to $148 million from $394 million a year ago and 47% from roughly $280 million in Q1, driving diluted EPS down to $0.29 from $0.73.
Operating costs rose 3% to $2.85 billion, with depreciation and amortization climbing 4% to $1.18 billion, and restructuring, acquisition and other charges spiked to $238 million versus $90 million last year, more than offsetting modest top-line growth. Finance costs also increased 9% to $628 million, while income tax expense grew 29% to $173 million.
The story is quite different on a non-GAAP basis. Adjusted net income improved 1% to $632 million from $623 million a year ago while adjusted diluted EPS declined 2% to $1.14 from $1.16. Adjusted EBITDA edged up 2% to $2.36 billion from last year, but the consolidated margin slipped 40 basis points to 45.3%.
Broken down per segment, Wireless revenue rose 3% to $2.54 billion. Adjusted EBITDA increased 1% to $1.31 billion and margin improved 10 bps to 65.3%. Monthly mobile phone ARPU fell $1.79 to $55.45, evidencing pricing pressure in what is referred by the firm as “a slowing market.”
In Cable, revenue was essentially flat at $1.97 billion, but service revenue inched up 1% on Internet growth. Adjusted EBITDA rose 3% to $1.147 billion and margin expanded 150 bps to 58.3% on cost efficiencies. ARPA also slid $3.88 to $135.74.
Media revenue climbed 10% to $808 million on NHL playoff strength and the Warner Bros. Discovery channel launches. Adjusted EBITDA was a slim $5 million versus break-even last year, as operating costs climbed 9%. Media capex plunged 44% as Rogers Centre modernization spend rolled off.
Cash provided by operating activities rose 8% to $1.60 billion, aided by lower interest paid and a smaller negative swing in working capital. Free cash flow surged 39% to $925 million from $666 million last year, primarily because capex dropped 17% to $831 million and interest outflows moderated. Year to date, FCF is up 21% to $1.51 billion.
The balance sheet ballooned with liquidity from the Blackstone transaction. Cash and equivalents jumped to $6.96 billion from $898 million at year-end 2024. Equity expanded to $17.867 billion from $10.40 billion, reflecting the $6.7 billion non-controlling interest created by Blackstone’s 49.9% stake in Backhaul Network Services.
Company guidance now assumes 3% to 5% service revenue growth (up from 0% to 3%), unchanged adjusted EBITDA growth of 0% to 3%, capex trimmed to approximately $3.8 billion (low end of prior $3.8–$4.0 billion), and free cash flow unchanged at $3.0–$3.2 billion. Dividends of $269 million were paid in the quarter, and the firm announced a $0.50 per share dividend.
Rogers Communications last traded at $47.04 on the TSX.
Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
