How did Telus (NYSE:TU) perform in Q1 2026?

Telus reported a 19% increase in free cash flow to $583 million in Q1 2026, despite a modest 1% growth in consolidated service revenue. The company added 262,000 net new mobile and fixed customers, reflecting resilience in the saturated Canadian telecom market. Adjusted EBITDA held steady at $1.8 billion, while the company continued its focus on diversifying into non-telecom sectors like AI and healthcare.

What drove Telus' increase in free cash flow in Q1 2026?

Telus saw a 19% increase in free cash flow to $583 million in Q1 2026, largely due to its disciplined approach to capital expenditure and a growing contribution from its non-telecom subsidiaries. The company’s technology-focused businesses, particularly Telus Digital and Telus Health, contributed significantly to cash generation, as demand for AI integration and digital healthcare services continued to rise.

What is the performance of Telus' core telecom business in Q1 2026?

Telus’ core telecom business showed muted growth, with consolidated service revenue increasing by just 1%. Traditional telecom margins were under pressure, reflecting a competitive and saturated Canadian market. However, the company’s ability to add 262,000 net new customers in mobile and fixed services demonstrates resilience in its connectivity business.

How did Telus’ technology subsidiaries perform in Q1 2026?

Telus’ technology subsidiaries performed strongly in Q1 2026. Telus Digital, focused on AI-related services, saw a 22% increase in AI-related revenue year-over-year as demand for generative AI integration grew among corporate clients. Telus Health also saw an 11% increase in both service revenue and adjusted EBITDA, further validating the company's strategic investments in digital healthcare services.

What is Telus' outlook for the 2026 fiscal year?

Telus has reaffirmed its financial targets for the 2026 fiscal year, expecting consolidated service revenue and adjusted EBITDA to grow within the range of 2% to 4%. The company also anticipates full-year free cash flow of approximately $2.45 billion, supported by its digital transformation initiatives and stable performance in the telecom sector.

Tech

Telus profit gains as AI and health offsets sluggish telecom growth

Written by Mahathir BayenaPublished May. 8 2026Last Updated May. 8 2026

Telus (NYSE:TU) demonstrated the growing impact of its non-telecom diversification strategy in the first quarter of 2026, reporting a significant jump in cash generation despite cooling revenue growth in its core connectivity business.

The Vancouver-based company posted a 19% increase in free cash flow to $583 million, even as consolidated service revenue grew by a muted 1% during the period.

The company added 262,000 net new mobile and fixed customers, reflecting a resilient performance in a saturated Canadian telecommunications landscape.

While traditional telecom margins remained under pressure, consolidated adjusted EBITDA held steady at $1.8 billion.

The stability in earnings was bolstered by a disciplined approach to capital expenditure, which is projected to reach approximately $2.3 billion for the full year.

The standout performers for the quarter were the company’s technology-focused subsidiaries.

Telus Digital saw its AI-related revenue surge 22% year-over-year, as corporate demand for generative AI integration continues to scale.

Simultaneously, Telus Health reported 11% growth in both service revenue and adjusted EBITDA, further validating the company's long-term bet on digitalizing healthcare services.

Confident in the trajectory of its digital transformation, Telus management reaffirmed its financial targets for the 2026 fiscal year.

The company expects consolidated service revenue and adjusted EBITDA to both grow within a range of 2% to 4%.

Furthermore, Telus is targeting full-year free cash flow of approximately $2.45 billion.