TELUS (NYSE:TU) Issues Earnings Results, Misses Expectations By $0.04 EPS

TELUS (NYSE:TU) (TSE:T) posted its earnings results on Friday. The Wireless communications provider reported $0.12 earnings per share for the quarter, missing the consensus estimate of $0.16 by ($0.04), Zacks reports. TELUS had a net margin of 4.54% and a return on equity of 8.29%. The business had revenue of $3.47 billion for the quarter, compared to analysts’ expectations of $3.55 billion.

Here are the key takeaways from TELUS’s conference call:

• TELUS reduced its 2026 outlook, now expecting consolidated service revenue to be flat to down 2% and adjusted EBITDA to decline 2% to 4%, versus its prior forecast of 2% to 4% growth. Full-year free cash flow guidance was also cut to approximately $1.8 billion from $2.45 billion.
• TELUS Digital recorded a $2.1 billion non-cash impairment after faster-than-expected automation reduced demand for legacy content moderation and search-related services, while AI adoption has been slower and deal sizes smaller than previously modeled.
• The quarterly dividend will be cut 55% to $0.1875 per share effective October 1, with the dividend reinvestment plan discount ending at the same time. Management expects the reset to generate approximately $2.7 billion in cumulative cash savings through 2028.
• Management is targeting net debt to adjusted EBITDA of 3.0x or lower by the end of 2028, supported by dividend savings, lower capital intensity over time, asset monetizations, a moratorium on acquisitions, and tighter cost discipline.
• Core telecom performance was relatively stable: mobile network revenue grew 1%, ARPU trends improved for a fifth consecutive quarter, and the promotional environment showed signs of moderating. However, lower immigration is constraining subscriber growth, while fixed-business results remain challenged.

TELUS Price Performance

Shares of NYSE TU opened at $9.55 on Friday. The company has a market capitalization of $15.04 billion, a price-to-earnings ratio of -23.30, a price-to-earnings-growth ratio of 7.42 and a beta of 0.63. The business has a 50 day simple moving average of $11.19 and a 200-day simple moving average of $12.46. The company has a current ratio of 0.67, a quick ratio of 0.63 and a debt-to-equity ratio of 1.59. TELUS has a twelve month low of $9.22 and a twelve month high of $16.72.

TELUS Cuts Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, October 1st. Shareholders of record on Thursday, September 10th will be paid a dividend of $0.1875 per share. The ex-dividend date is Thursday, September 10th. This represents a $0.75 annualized dividend and a yield of 7.8%. TELUS’s dividend payout ratio is presently 275.00%.

TELUS News Roundup

Here are the key news stories impacting TELUS this week:

• Positive Sentiment: TELUS outlined a plan to reduce leverage to 3.0 times or lower by the end of 2028, while prioritizing balance-sheet strength and long-term growth. The company also plans to remove the discount on its dividend reinvestment plan beginning October 1, which should reduce shareholder dilution. TELUS Reports Second-Quarter 2026 Results
• Neutral Sentiment: The board declared a quarterly dividend of $0.1875 per share, payable October 1 to shareholders of record September 10. The payment represents an annualized yield of approximately 7.8%, although the dividend reset reduces the appeal for income-focused investors. TELUS Declares Quarterly Cash Dividend
• Negative Sentiment: TELUS reported second-quarter adjusted earnings of $0.12 per share, below estimates ranging from $0.14 to $0.16 and down from $0.16 a year earlier. The company also missed revenue expectations, reinforcing concerns about operating performance and helping drive selling pressure. TELUS Lags Q2 Earnings and Revenue Estimates
• Negative Sentiment: The dividend reset is a near-term setback for shareholders and signals that management is prioritizing debt reduction over maintaining the previous payout trajectory. TELUS reported a 4.54% net margin and 8.29% return on equity, highlighting limited profitability relative to its substantial leverage. TELUS Dividend Reset and Financial Results

Analyst Upgrades and Downgrades

A number of research firms recently issued reports on TU. Scotiabank lowered TELUS from an “outperform” rating to a “sector perform” rating in a research note on Friday, April 10th. Canadian Imperial Bank of Commerce lowered shares of TELUS to a “neutral” rating in a report on Friday. Raymond James Financial initiated coverage on shares of TELUS in a research report on Wednesday, July 15th. They issued a “market perform” rating for the company. TD Cowen upgraded TELUS from a “hold” rating to a “buy” rating in a report on Tuesday, April 28th. Finally, Wall Street Zen downgraded TELUS from a “hold” rating to a “sell” rating in a research report on Saturday. Five investment analysts have rated the stock with a Buy rating, six have issued a Hold rating and three have issued a Sell rating to the stock. According to MarketBeat.com, the stock has an average rating of “Hold” and a consensus target price of $15.67.

Institutional Trading of TELUS

Several hedge funds have recently made changes to their positions in the stock. Towarzystwo Funduszy Inwestycyjnych PZU SA increased its holdings in shares of TELUS by 129.0% in the 4th quarter. Towarzystwo Funduszy Inwestycyjnych PZU SA now owns 2,473 shares of the Wireless communications provider’s stock worth $33,000 after acquiring an additional 1,393 shares during the period. State of Wyoming acquired a new position in TELUS during the 2nd quarter worth $61,000. Employees Retirement System of Texas bought a new position in shares of TELUS in the third quarter worth $64,000. Kestra Advisory Services LLC acquired a new position in shares of TELUS during the fourth quarter valued at $55,000. Finally, Northwestern Mutual Wealth Management Co. increased its holdings in shares of TELUS by 37.1% during the third quarter. Northwestern Mutual Wealth Management Co. now owns 4,585 shares of the Wireless communications provider’s stock valued at $72,000 after purchasing an additional 1,241 shares during the period. Institutional investors own 49.40% of the company’s stock.

TELUS Company Profile

TELUS Corporation (NYSE: TU) is a Canadian telecommunications and technology company headquartered in Vancouver, British Columbia. It delivers a broad portfolio of consumer and business communications services across Canada, including mobile wireless, fixed-line voice, broadband internet, and television. TELUS also provides a range of enterprise services such as cloud and IT solutions, managed network services, cybersecurity and Internet of Things (IoT) offerings for business customers.

Beyond core connectivity, TELUS has expanded into health and digital services.