Rogers Revenue Beats Ahead of Critical 5G Spectrum Auction

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Rogers Communications Inc. said first-quarter revenue rose 2% to C$3.49 billion ($2.77 billion), compared with a year earlier, beating analysts’ average estimates of C$3.35 billion.

  • The revenue beat was driven by a 5% boost in cable revenue, even as average wireless revenue per user fell 7% to C$49.09. Roaming revenue took a hit as lockdowns and stay-at-home orders persisted across the country.

Key Insights

  • The Toronto-based company added 44,000 new postpaid wireless subscribers.
  • Rogers’ profitability beat expectations. Adjusted earnings were 77 Canadian cents per share, which was better than the average analyst estimate of 67 cents.
  • “Our solid first quarter results reflect disciplined execution in each of our business units, and our continued ability to support the needs of our customers despite the challenges of the pandemic,” Joe Natale, President and CEO said in statement.
  • The company had previously warned that lockdowns would affect first quarter wireless service revenue.
    • “Rogers has Canada’s largest wireless roaming operation, which has left it particularly vulnerable to the loss of related fees amid extensive pandemic-fueled travel restrictions that persisted through 1Q,” Bloomberg Intelligence analyst John Butler said.
  • The report comes as the telecommunications giant prepares for a spectrum auction in June that will be critical to the expansion of 5G technology in Canada.
  • This is the company’s first earnings report since announcing its C$26 billion acquisition of Shaw Communications Inc. in March. The deal, which will be scrutinized by Canada’s antitrust body, the telecommunications regulator and the federal government, is expected to close in the first half of 2022.
  • The report also comes after the industry’s regulator ruled that large wireless carriers, including BCE Inc. and Rogers, have to resell access to their networks to smaller players.

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