Rogers adds fewer wireless subscribers than expected in Q2
Rogers Communications Inc. (RCIb.TO) added fewer net wireless subscribers in its fiscal second quarter amid a price war among Canadian telcos.
The Toronto-based company’s postpaid net subscriber additions, a key metric for telecom companies, were 77,000, short of analysts’ estimate of 99,250. Revenue was $3.78 billion, also missing estimates of $3.86 billion. Revenue at the wireless division, Rogers’ largest, rose one per cent to $2.24 billion.
The telecoms and media company has been struggling to get more subscribers for its wireless services in the face of increasing competition from players such as Shaw Communications Inc., a relatively new entrant to the Canadian market.
Shaw has been quickly adding market share, accounting for 37 per cent of the new postpaid subscribers acquired by the top four Canadian telecoms providers including Rogers and Telus Corp. in the first quarter of 2019, according to Bloomberg Intelligence data. Rogers’ market share of industry net adds declined to 13 per cent from 35 per cent in the same period.
In a bid to attract more subscribers, Rogers introduced its own unlimited wireless plan, Infinite, in June. Competitors BCE Inc. and Telus responded by offering their own promotional offers, sparking a price war in the crowded Canadian market.
-Analysts have called Rogers’ Infinite unlimited wireless offering “worrisome” as such promotional plans may hurt the company’s average revenue per user in the short term. However, these can help the telecoms company to maintain its market share in a maturing wireless market in Canada.
-Adjusted earnings per share of $1.16 fell short of analyst estimates of $1.17 in the quarter.
-The Canadian carrier’s shares have been down 0.5 per cent year to date.
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