Rogers Communications (NYSE: RCI) released its first-quarter 2026 results on April 22, showing revenue and earnings that surpassed analyst forecasts. Shares climbed 3.58% to $34.17 amid the positive update.
Earnings per share reached $0.7258, topping the $0.72 consensus estimate. Revenue hit $3.94 billion, exceeding projections of $3.91 billion.
Key Highlights from Management
Executives emphasized substantial reductions in capital expenditures (CAPEX) and upward revisions to free cash flow (FCF) guidance as core drivers of the quarter’s success. CAPEX fell nearly $900 million below prior plans, while full-year FCF outlook rose to $8 billion. These shifts reflect optimized capital allocation.
The overall performance signals improved operating momentum across all business units, positioning Rogers for stronger free cash flow generation throughout the year.
Segment Breakdown
Wireless Division
Wireless operations drove combined revenue and margin growth. Total service revenue increased 10% year-over-year to $4.912 billion, with adjusted EBITDA up 5% to $2.364 billion. FCF surged 32% to $776 million in the quarter.
Guidance EPS climbed 56% to $4.38, and free cash flow EPS rose 60% to $0.80. Despite competitive pressures, the unit added 33,000 postpaid mobile subscribers. Average revenue per user (ARPU) dipped 2.4% to $55.60 due to promotional activity, while postpaid churn improved 21 basis points to 1.22%.
Cable Division
Cable delivered stable results, with adjusted EBITDA up 1% to $1.323 billion and margins expanding 40 basis points to 65.1%. However, base operations faced some pressure. ARPU declined 2.4% to $56.94 amid promotions, and churn rose 21 basis points to 1.22%. The segment added 33,000 mobile subscribers.
Cable service revenue and adjusted EBITDA grew 1% year-over-year in the first half, partly offset by data center sales impacts. Executives expect 2% growth in the second half despite data center divestitures.
Media Division
Media saw revenue rise 82% to $988 million, fueled by Maple Leaf Sports & Entertainment (MLSE) contributions. Adjusted EBITDA increased to $63 million.
Capital Allocation Focus
CAPEX emerged as the quarter’s standout factor, dropping 17% year-over-year to $888 million, with the ratio to EBITDA falling 500 basis points to 14.7%. This operational shift supports ongoing guidance adjustments.
Rogers now forecasts full-year CAPEX at $2.5-2.7 billion, down from $3.3-3.5 billion. Free cash flow guidance rises to $4.1-4.3 billion from $3.3-3.5 billion, implying 28% growth over 2025’s $3.356 billion.
Full-Year Growth Outlook
Management reaffirmed total service revenue growth of 3-5% and adjusted EBITDA growth of 1-3%. Lower CAPEX enables sustained revenue and EBITDA momentum despite network investments and seasonal factors.
Balance Sheet and Valuation
Leverage improved to 3.8 times adjusted EBITDA. The company raised $600 million through asset sales. Portfolio average interest rates stand at 4.93%, with an average maturity of 8.6 years.
With a market cap around $18.06 billion, Rogers holds a solid valuation profile. Q1 free cash flow growth of 32% and raised guidance underscore potential for enhanced shareholder returns amid evolving competitive dynamics.
