Quebecor Posts Record Q2 Telecom EBITDA, Raises Dividend 12.5%
The Canadian telecom and media company delivered its strongest second-quarter performance ever in its telecom segment while simultaneously growing both subscriber counts and average revenue per user.
Record Quarter Drives Dividend Increase
Quebecor Inc. reported its strongest second-quarter performance ever in its telecom segment, with adjusted EBITDA reaching $642 million, up 5% year-over-year and representing "the highest quarterly growth we ever recorded for a second quarter," according to CEO Pierre Karl Péladeau (earnings call, 2026-08-06). The company's board responded by raising the quarterly dividend from $0.40 to $0.45 per share, a 12.5% increase.
Consolidated free cash flow increased $44 million, or 12%, to $419 million in the quarter, while net income attributable to shareholders grew 24% to $227 million. The company maintained its net debt-to-EBITDA ratio at 2.87x, which Péladeau described as "still the lowest leverage of the Canadian industry by some margin" (earnings call, 2026-08-06).
Defying Industry Trade-offs
Quebecor's telecom segment added 53,200 net mobile subscribers in Q2, a significant acceleration from 28,800 in Q1. Notably, the company achieved this growth while simultaneously increasing its consolidated mobile ARPU by 2.5% year-over-year to $35.62, marking the third consecutive quarter of ARPU growth.
"Although the conventional wisdom in the industry has long been that you must choose between [subscriber growth] and ARPU, we are proving it wrong, consistently, measurably and concurrently growing our subscriber base and our ARPU rather than sacrificing one to achieve the other," Péladeau said (earnings call, 2026-08-06).
Total telecom service revenues reached $1.103 billion, up 4.2%, with wireless service revenues climbing 9% to $476 million. The segment's adjusted EBITDA margin improved 60 basis points to 52%.
Strategic Investments and Operational Efficiency
The company increased its equity position to a majority stake in Etiya, a Turkey-based digital business support system platform provider with more than 1,500 employees. The investment builds on Quebecor's initial 2021 stake and supports the rollout of a common BSS platform across its Videotron and Freedom Mobile brands.
CFO Hugues Simard emphasized the company's structural efficiency gains, noting that operating expenses fell to 48% of revenue from 48.6% last year. "This is not a onetime optimization, and it has not come from headcount reductions. It is the compounding effect of the continued optimization of our cost base while improving the quality of our revenues," Simard said (earnings call, 2026-08-06).
Capital expenditures in telecom, excluding spectrum licenses, increased $18 million, or 12%, primarily for internet infrastructure build-out and 5G expansion, including Freedom Mobile's national footprint expansion.
Media Segment Recovers
Quebecor's media segment posted adjusted EBITDA of $27 million, up $18 million year-over-year, driven by the Montreal Canadiens' playoff run, which boosted advertising and subscription revenues. Media revenues reached $185 million, up 6% from the prior year.
For the first half of 2026, consolidated revenues rose 4% to $2.8 billion, while telecom segment EBITDA grew 8%, an improvement of nearly $100 million year-over-year excluding stock-based compensation.
This article was generated by MarginX from the earnings call on 2026-08-06. It is not investment advice.