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Rogers Communications RCI reported first-quarter 2025 adjusted earnings of 69 cents per share, which missed the Zacks Consensus Estimate by 2.82% and remained flat year over year. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)
Revenues of $3.47 billion missed the consensus mark by 1.19% and decreased 4.6% year over year.
In domestic currency (Canadian dollar), adjusted earnings remained flat year over year at C$0.99 per share. Total revenues increased 1.5% year over year, reaching C$4.98 billion, driven by service revenue growth in Wireless and Media businesses.
Wireless revenues (51.1% of total revenues) increased 0.6% year over year to C$2.54 billion. Service revenues rose 1.5% to C$2.02 billion. Equipment revenues declined 2.6% to $518 million.
Rogers Communication, Inc. price-consensus-eps-surprise-chart | Rogers Communication, Inc. Quote
Monthly mobile phone ARPU was C$56.94, down 1.9% year over year.
As of March 31, 2025, the prepaid subscriber base totaled 1.13 million, representing an increase of 111K subscribers year over year. The monthly churn rate was 3.34% compared with 3.9% reported in the year-ago quarter.
As of March 31, 2025, the postpaid wireless subscriber base totaled 10.78 million, representing net additions of 293K subscribers year over year. The monthly churn rate was 1.01% compared with 1.10% in the year-ago quarter.
Segment operating expenses declined 0.9% year over year to C$1.23 billion.
Adjusted EBITDA increased 2.1% year over year to C$1.31 billion. Adjusted EBITDA margin expanded 70 basis points (bps) on a year-over-year basis to 51.5%.
Cable revenues (38.9% of total revenues) decreased 1.2% year over year to C$1.93 billion due to continued competitive promotional activity and declines in Home Phone, Video, and Satellite subscriber bases.
Service revenues fell 1.2% year over year to C$1.92 billion. Equipment revenues decreased 8.3% on a year-over-year basis to C$11 million.
As of March 31, 2025, the retail Internet subscriber count was nearly 4.296 million, representing a net increase of 108K subscribers year over year.
As of March 31, 2025, total Smart Home Monitoring subscribers reached 138K, indicating an increase of 50K subscribers. The total Home Phone subscriber count was nearly 1.48 million, reflecting a loss of 113K customers in the reported quarter.
ARPA was C$136.97, lower than the C$140.1 reported in the year-ago quarter.
Segment operating expenses declined 3.7% year over year to C$827 million.
Adjusted EBITDA increased 0.7% year over year to C$1.11 billion.
Media revenues (12% of total revenues) increased 24.4% year over year to C$596 million as a result of higher sports-related revenues, including at the Toronto Blue Jays, and higher subscriber and advertising revenues related to the launch of Warner Bros. Discovery’s suite of channels and content.
Segment operating expenses increased 13.9% year over year to C$663 million.
The segment reported a negative adjusted EBITDA of $67 million, compared with a negative adjusted EBITDA of $103 million reported in the year-ago quarter.
Operating costs increased 1.3% to C$2.72 billion. As a percentage of revenues, operating costs contracted 10 bps to 54.7%.
Adjusted EBITDA rose 1.8% year over year to C$2.25 billion. Adjusted EBITDA margin expanded 10 bps to 45.3%.
As of March 31, 2025, Rogers Communications had C$7.5 billion of available liquidity, including C$2.7 billion in cash and cash equivalents and C$4 billion available under bank and other credit facilities. In comparison, RCI had C$4.8 billion of available liquidity as of Dec. 31, 2024, including $0.9 billion in cash and cash equivalents and a combined C$3.5 billion available under the bank credit facility.
Rogers Communications’ debt leverage ratio was 4.3 times as of March 31, 2025, as a result of cost reductions, earnings growth, proceeds from asset sales and commencing the payback of acquisition-related debt.
Cash flow from operating activities was C$1.29 billion compared with C$1.1 billion generated in the previous quarter. Free cash flow was C$586 million compared with C$878 million generated in the previous quarter.
Rogers Communications paid dividends worth C$269 million and declared a C$0.50 per share dividend.
For 2025, Rogers Communications reiterates its outlook for total service revenues and adjusted EBITDA growth and capital expenditures and free cash flow.
For 2025, RCI expects total service revenues to grow in the range of 0-3%. Adjusted EBITDA is expected to grow in the range of 0-3%.
Capital expenditure is expected to be between C$3.8 billion and C$4 billion. Free cash flow is expected in the range of C$3-C$3.2 billion.
Currently, RCI carries a Zacks Rank #3 (Hold).
DTE Energy DTE, Atmos Energy ATO and Avista AVA are some better-ranked stocks that investors can consider in the broader sector. DTE, ATO and AVA carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DTE Energy shares have appreciated 12.9% year to date. DTE is set to report its first quarter 2025 results on May 1.
Atmos Energy shares have gained 14.3% year to date. ATO is set to report its Fiscal 2025 second quarter results on May 8.
Avista shares have surged 13% year to date. AVA is set to report its first quarter 2025 results on May 7.
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This article originally published on Zacks Investment Research (zacks.com).
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