TU

Onto Innovation Inc. ONTO reported second-quarter 2026 earnings per share of $1.93, which exceeded the Zacks Consensus Estimate by 15%. The bottom line also compared favorably with the prior-year quarter's $1.25. Management expected non-GAAP EPS between $1.65 and $1.73. Onto Innovation reported second-quarter revenue of $343.1 million, marking a 35.3% year-over-year increase. Revenue also rose nearly 18% sequentially, setting a new record for the company's highest quarterly revenue. The top line surpassed both management’s guidance ($320–$330 million) and the Zacks Consensus Estimate of $325.6 million. Key factors driving this strong performance included record revenue from Advanced Nodes, record sales in Specialty Devices, robust growth in Advanced Packaging solutions and ongoing investments by leading logic and memory chip manufacturers. According to management, customer visibility remains high as semiconductor companies continue investing in multi-year expansion initiatives. One of the most notable highlights was the company's backlog surpassing $1 billion for the first time. The company expects these investments to support solid second-half 2026 revenue, sustained AI infrastructure spending and demand that extends well into 2027. The record backlog offers greater revenue visibility and indicates customer confidence despite broader macroeconomic uncertainties. Following the successful launch of Dragonfly G5, Onto Innovation is seeing record demand across a broader customer base, prompting it to raise its full-year advanced packaging growth outlook to about 80% from 50%. Demand is being driven by HBM manufacturers and OSATs supporting AI-focused heterogeneous packaging. During the quarter, the company secured more than $200 million in Dragonfly orders from a single OSAT customer, with most deliveries scheduled for 2027. Onto Innovation Inc. price-consensus-eps-surprise-chart | Onto Innovation Inc. Quote Advanced Packaging and Specialty Devices accounted for nearly half of second-quarter revenue. Dragonfly inspection revenue rose 30% sequentially, driven by 2.5D and HBM demand. At the same time, other packaging and specialty segments, including power and SDI, declined as expected but are projected to recover to first-quarter levels next quarter. Advanced Nodes revenue increased approximately 50% sequentially to $120 million, reflecting stronger customer spending on next-generation semiconductor technologies required for AI processors and high-performance computing chips. In this category, memory accounted for around 60% of revenue and increased about 60% sequentially, while logic advanced more than 40%. Software and services accounted for the remainder of the second quarter revenue. Non-GAAP gross margin was 57%, up 250 basis points (bps) year over year and 130 bps sequentially, exceeding management's initial target of 200 bps of margin expansion for 2026. Non-GAAP operating income rose to $102.8 million from $65.6 million in the prior-year quarter. Driven by stronger operating leverage, Onto Innovation's operating margin expanded to 30%, up nearly 500 bps from the beginning of the year. Total operating expenses for the quarter were $119.7 million compared with $89.9 million in the previous-year quarter. As of June 30, 2026, the company had $1.9 billion in cash, cash equivalents and marketable securities and $271.6 million of total current liabilities compared with $654.2 million and $214.5 million, respectively, as of March 31. Accounts receivable were $337.4 million. Onto Innovation generated $62 million in cash from operations during the quarter, representing just over 100% of net income. Driven by robust demand and strong execution, Onto Innovation raised its second-half 2026 revenue, margin and EPS outlook. Building on a strong first half, ONTO expects second-half revenue to grow more than 25%, with third-quarter revenue of $380–$400 million and further growth in the fourth quarter. At the midpoint, revenue guidance implies another sequential increase of roughly 14%, suggesting demand remains exceptionally strong. Despite ongoing cost headwinds, including higher material, fuel and freight expenses, Onto Innovation expects gross margin to expand by another 50 bps in each of third and fourth quarters. The company expects gross margin between 57.3% and 57.8%. Onto expects operating margin to improve by 200 bps to 31.5%-32.5% in the third quarter and exceed 33% by year-end. Per management, Onto Innovation is on track to deliver 350 bps of gross margin expansion and more than 750 bps of operating margin improvement in 2026, with further gains expected in 2027. It further expects non-GAAP EPS between $2.18 and $2.38, GAAP EPS of $1.54 to $1.70 and GAAP operating margin of 21.4% to 22.4%. Onto Innovation currently boasts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Watts Water Technologies, Inc. WTS reported second-quarter 2026 adjusted earnings of $3.66 per share, up 18.4% from $3.09 a year ago. The bottom line beat the Zacks Consensus Estimate of $3.34 by 9.6%. Net sales rose 18.6% year over year to $763.2 million and topped the consensus mark of $726 million by 5.1%. Organic sales advanced 12.2%, driven by favorable pricing, higher volumes and data center growth. Year-to-date data center sales represented 8% of total sales. TELUS Corporation TU reported second-quarter 2026 adjusted earnings per share of C$0.16, down 27% from C$0.22 a year ago. Adjusted net income fell 26% to C$254 million, while operating revenues and other income declined 3% to C$4,929 million, pressured by weaker TELUS Digital results, lower mobile equipment revenues and reduced other income. Fortive Corporation FTV reported second-quarter 2026 adjusted earnings of 74 cents per share, which jumped 28.5% year over year and topped the Zacks Consensus Estimate of 71 cents by 4.2%. Revenues rose 7.9% year over year to $1.10 billion and beat the consensus estimate of $1.06 billion by 3.5%. Core revenues increased 6.7%, reflecting price and volume growth in both operating segments. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Onto Innovation Inc. (ONTO) : Free Stock Analysis Report TELUS Corporation (TU) : Free Stock Analysis Report Watts Water Technologies, Inc. (WTS) : Free Stock Analysis Report Fortive Corporation (FTV) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

BCE Inc. BCE reported second-quarter 2026 adjusted earnings of C$0.65 per share (47 cents), up 3.2% year over year. The figure beat the Zacks Consensus Estimate by 2.2%. Total operating revenues rose 1.5% to C$6.18 billion ($4.461 billion), topping the consensus estimate of $4.401 billion. The improvement was primarily driven by 4.3% growth in service revenue, contribution from Ziply Fiber following its acquisition, strong Bell Media performance and growth in AI-powered enterprise services. However, product revenue declined 16.3%, mainly because last year's results included revenue from the completion of Bell's first AI Fabric data center and lower wireless device sales as more customers opted for bring-your-own-device (BYOD) plans. Adjusted EBITDA rose 1% to C$2.70 billion. The adjusted EBITDA margin was 43.8% compared with 43.9% a year earlier, as higher operating revenues were partly offset by Ziply Fiber expenses and increased content costs at Bell Media. BCE, Inc. price-consensus-eps-surprise-chart | BCE, Inc. Quote Bell CTS Canada operating revenues declined 4% to C$5.12 billion. The fall reflected lower service and product revenues, including the non-recurrence of G7 Summit and federal election-related revenues, ongoing legacy service erosion, a CRTC wholesale-rate adjustment and lower wireless connection fees. Adjusted EBITDA for the Canadian segment fell 3.1% to C$2.36 billion. However, margin improved 40 basis points to 46.1% as operating costs declined 4.7%, helped by lower device costs, the absence of prior-year data-center and G7-related costs, and cost-reduction initiatives. Postpaid mobile phone net activations were 41,594, down 6.6% year over year as gross activations declined in a less active market with lower promotional intensity. Blended ARPU fell 2.3% to C$56.30, though management said ARPU was relatively stable excluding the prior-year G7 impact. Bell CTS Canada recorded 45,271 residential FTTH Internet net additions versus 47,920 a year earlier. Ziply Fiber contributed 9,612 FTTH net additions, its highest quarterly residential result since BCE acquired the business. Canadian video net additions improved to 8,741 from a loss of 15,851. Bell Media revenues advanced 8.9% to C$918 million, driven by the FIFA World Cup, Crave growth, the Formula 1 Canadian Grand Prix and higher program sales. Advertising revenues increased 5.3%, subscriber revenues rose 6.7% and digital revenues grew 5.8%. Crave subscriptions increased 23% to 5.07 million, with direct-to-consumer streaming subscribers up 49%. Bell Media adjusted EBITDA rose 3.8% to C$244 million, while margin declined to 26.6% from 27.9% as operating costs increased 10.9% on sports, content and event-related spending. Cash flows from operating activities increased 11% to C$2.16 billion. Capital expenditures rose 41.5% to C$1.08 billion on Bell AI Fabric and Ziply Fiber investment, pushing free cash flow down 9.5% to C$1.04 billion. Bell AI Fabric had about 335 MW of contracted capacity, including the 300 MW Saskatchewan facility. The first Saskatchewan phase remains scheduled for the first half of 2027, while most of roughly C$1.3 billion of expected 2026 project capex is slated for the second half. BCE ended the quarter with C$4.6 billion of available liquidity and a 3.71 net debt leverage ratio. BCE reaffirmed 2026 guidance for revenue growth of 1% to 5% and adjusted EBITDA growth of 0% to 4%. Management continues to expect capital intensity of about 20%, supported by investment in the Saskatchewan AI data center. Adjusted EPS is still projected to decline 5% to 11% while free cash flow is expected at C$2.10 billion to C$2.30 billion. BCE maintained its C$1.75 annualized common dividend and remains on track for a 3.5 net debt leverage ratio by the end of 2027. BCE currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. TELUS Corporation TU reported second-quarter 2026 adjusted earnings per share of C$0.16, down 27% from C$0.22 a year ago. Adjusted net income fell 26% to C$254 million, while operating revenues and other income declined 3% to C$4,929 million, pressured by weaker TELUS Digital results, lower mobile equipment revenues and reduced other income. Lumen Technologies, Inc. LUMN reported a second-quarter 2026 adjusted loss (excluding special items) of 7 cents per share, narrower than the Zacks Consensus Estimate of a loss of 15 cents. The company reported adjusted loss per share of 3 cents in the prior-year quarter. Quarterly total revenues were $2.805 billion, down 9.3% year over year, but topped the Zacks Consensus Estimate by 2%. Rogers Communications Inc RCI reported second-quarter 2026 adjusted earnings of 83 cents per share, topping the Zacks Consensus Estimate and up 1.2% year over year. Revenues of $4.06 billion surpassed the consensus mark by 2.45% and increased 7.6% year over year. In domestic currency (Canadian dollar), RCI’s total revenues increased 7.7% year over year to C$5.62 billion, primarily driven by growth in the Media businesses. Total service revenues increased 8% year over year to C$5.06 billion in the quarter. Shares for RCI are up 2.5% in the past year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BCE, Inc. (BCE) : Free Stock Analysis Report TELUS Corporation (TU) : Free Stock Analysis Report Rogers Communication, Inc. (RCI) : Free Stock Analysis Report Lumen Technologies, Inc. (LUMN) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Western Digital Corporation WDC reported fourth-quarter fiscal 2026 non-GAAP earnings of $3.56 per share, which surpassed the Zacks Consensus Estimate of $3.35. The bottom line increased 109% year over year and 31% sequentially, exceeding the high end of management’s guidance of $3.25 (+/- 15 cents). Quarterly revenues of $3.75 billion surged 44% year over year, surpassing the Zacks Consensus Estimate of $3.70 billion. Western Digital attributed its strong financial performance to innovation, operational excellence and rising customer storage demand. Entering fiscal 2027, the company sees robust demand, improved visibility and confidence in its ability to meet growing AI- and cloud-driven storage needs with its industry-leading products and technology roadmap. For fiscal 2026, revenues grew 36% year over year to $12.9 billion. The broader storage industry remains supported by several favorable long-term trends. AI workloads require enormous datasets, increasing the need for high-capacity storage solutions. Cloud providers continue to expand their data centers globally, while enterprises modernize their digital infrastructure. Additionally, growing adoption of video analytics, autonomous systems, IoT, cybersecurity data retention and regulatory compliance all contribute to increasing storage demand. Western Digital's product portfolio positions it to benefit from many of these secular growth drivers. Western Digital Corporation price-consensus-eps-surprise-chart | Western Digital Corporation Quote During the quarter, Western Digital shipped 231 exabytes, up 22% year over year, driven by strong nearline demand and solid growth in non-nearline storage. The company also began shipping next-generation ePMR hard drives up to 40TB, with volume ramp expected over the coming quarters. Alongside its earnings announcement, Western Digital's board of directors declared a quarterly cash dividend of 15 cents per share, payable on Sept. 17 to shareholders on record as of Sept. 8, 2026. Revenues from the Cloud end market (89% of total revenues) climbed 43% year over year to $3.3 billion, driven by strong demand for higher-capacity nearline products and a favorable pricing environment. Revenues from the Client end market (6%) were up 61% year over year to $225 million. Revenues from the Consumer end market (5%) rallied 38% year over year to $187 million. Both segments experienced pricing improvements. WDC reported a non-GAAP gross margin of 54.4%, up 1,310 basis points (bps) year over year and 390 bps sequentially, above its guidance (51-52%). Higher-capacity drive sales, improved pricing and manufacturing discipline drove results, with the average price per terabyte increasing from the high single digits to the high teens year over year. Non-GAAP operating expenses were $382 million, improving 170 bps sequentially, reflecting stronger operating leverage. Strong revenue growth, higher gross margins and operating leverage drove non-GAAP operating income to $1.66 billion, with the operating margin expanding to 44.2%, up 1,610 bps year over year. As of July 3, 2026, cash and cash equivalents were $1.6 billion compared with $2 billion reported as of April 3. WDC ended the quarter with $1.1 billion of debt. Western Digital generated $1.4 billion in cash from operations compared with $746 million in the prior-year quarter. Free cash flow amounted to $1.3 billion in the quarter under review, up 90%. Western Digital completed the exchange of its remaining 1.7 million SanDisk shares for 4.8 million WD shares and repurchased 2.3 million shares for $1 billion during the quarter. Western Digital issued encouraging guidance for the first quarter of fiscal 2027. It continues to benefit from robust demand, stronger long-term visibility and favorable pricing across its end markets. At the midpoint of its guidance, Western Digital anticipates non-GAAP revenues of $4.1 billion (+/- $100 million), up 45% year over year. Management projects non-GAAP earnings of $4 (+/- 15 cents). WDC expects non-GAAP gross margin in the range of 55-56%. Non-GAAP operating expenses are expected to be between $390 million and $400 million. Interest and other expenses are anticipated to be approximately $15 million. Currently, Western Digital sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Seagate Technology Holdings plc STX reported fourth-quarter fiscal 2026 non-GAAP earnings of $5.71 per share, beating the Zacks Consensus Estimate of $5.10 and exceeding the high end of management’s guidance of $5 per share (+/- 20 cents). The bottom line also expanded a whopping 121% year over year. Non-GAAP revenues of $3.6 billion surpassed the Zacks Consensus Estimate by 3.9%. Revenues were above the midpoint of guidance, increasing 48% year over year. Robust cloud spending and disciplined operational execution boosted the company's performance. TELUS Corporation TU reported second-quarter 2026 adjusted earnings per share of C$0.16, down 27% from C$0.22 a year ago. Adjusted net income fell 26% to C$254 million, while operating revenues and other income declined 3% to C$4,929 million, pressured by weaker TELUS Digital results, lower mobile equipment revenues and reduced other income. Progress Software Corporation PRGS reported second-quarter fiscal 2026 results wherein revenues came in at $253 million, up 7% year over year and 6% on a constant currency (cc) basis. ARR of $868 million inched up 2% year over year on a cc basis. PRGS reported a 16% year-over-year increase in non-GAAP earnings per share, which stood at $1.62. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Western Digital Corporation (WDC) : Free Stock Analysis Report TELUS Corporation (TU) : Free Stock Analysis Report Seagate Technology Holdings PLC (STX) : Free Stock Analysis Report Progress Software Corporation (PRGS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

CDW Corporation CDW reported second-quarter 2026 non-GAAP earnings per share (EPS) of $2.91, beating the Zacks Consensus Estimate of $2.80. The bottom line increased approximately 12% year over year. CDW generated quarterly net sales of $6.57 billion, representing a 10% year-over-year increase. On a constant currency (cc) basis, revenue increased 9.9%, indicating that growth was primarily driven by stronger customer demand rather than favorable foreign exchange movements. Increased investments across several technology categories, including data storage solutions, enterprise servers, notebooks, mobile devices, software and networking and communications products, led to top-line expansion. These categories continue to benefit from enterprise digital transformation initiatives, hybrid work environments, cybersecurity upgrades and expanding AI infrastructure requirements. The consensus estimate was pinned at $6.26 billion. As organizations move beyond experimenting with AI and start implementing production-scale AI solutions, CDW seems well-positioned to benefit from this shift. CDW expects to outperform the overall U.S. IT market by 200-300 basis points at cc over the long term despite ongoing macroeconomic uncertainties. Management believes several structural trends like infrastructure modernization, cloud migration, AI adoption, increasing cybersecurity investments, growing technology complexity and digital workplace transformation will keep supporting demand. As enterprise environments grow more sophisticated, customers increasingly seek strategic partners capable of delivering comprehensive technology solutions rather than just individual products. Separately, the company announced a quarterly dividend of 63 cents, payable on Sept. 10, 2026, to shareholders on record as of Aug. 25. Image Source: Zacks Investment Research In the past three months, CDW's shares have gained 41.3% compared with the Zacks Computers-IT Services industry’s rise of 3.6%. The Commercial segment continued to be CDW's largest contributor, generating $3.97 billion in sales, an increase of 9.2%. Growth was broad-based across several industries under Commercial. Corporate customers increased spending by 10.7%, Healthcare customers grew 9.1% and Financial Services customers expanded purchases by 1.8%. CDW Corporation price-consensus-eps-surprise-chart | CDW Corporation Quote Government sales reached $848 million, increasing 13.6% year over year, reflecting continued investments by public sector organizations in technology modernization. The Education segment remained relatively stable with 0.7% growth, generating $933 million in revenue. International operations performed exceptionally well. Net sales in Other (the U.K. and Canadian operations) generated $826 million in sales, growing 22.9%, making international markets one of the strongest contributors during the quarter. Gross profit increased 6.3% year over year to $1.32 billion. However, gross margin declined slightly from 20.8% to 20.1%. Management attributed the lower margin primarily to a higher sales mix toward lower-margin hardware and margin pressure in selected hardware categories. These factors were partially offset by higher contributions from netted-down revenue. Although gross margin contracted modestly, the company continued expanding earnings through disciplined cost management and operating efficiency. Non-GAAP operating income increased 7% year over year to $556 million. The non-GAAP operating margin fell to 8.5% from 8.7%. Selling and administrative expenses rose 8.6% to $891 million, primarily due to higher employee compensation, increased performance-based incentives and workplace optimization initiatives. As of June 30, 2026, CDW had $361.8 million of cash and cash equivalents compared with $578.6 million as of March 31. The company had a long-term debt of $5.82 billion compared with $5.64 billion as of March 31, 2026. For the six months that ended June 30, 2026, CDW generated $219.7 million of cash flow from operating activities compared with $443.1 million a year ago. Adjusted free cash flow totaled $278.4 million. CDW currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Wix.com Ltd. WIX reported second-quarter 2026 non-GAAP earnings of $1.39 per share, down 39% year over year but above the Zacks Consensus Estimate of $1.13. Revenues rose 15% year over year to $563.1 million and beat the consensus mark of $554 million. Growth reflected strong Base44 performance and continued core Wix expansion. Cadence Design Systems CDNS, a well-known player in the electronic design automation (EDA) space, recently reported strong second-quarter 2026 results with a record backlog that underscores sustained demand for its solutions. Revenues of $1.584 billion beat the Zacks Consensus Estimate by 0.5% and increased 24.2% year over year. The figure was within the management’s guided range of $1.555-$1.595 billion. All the product groups witnessed double-digit growth. Non-GAAP EPS of $2.11 beat the Zacks Consensus Estimate by 2.9%, increased 27.9% year over year. TELUS Corporation TU reported second-quarter 2026 adjusted earnings per share of C$0.16, down 27% from C$0.22 a year ago. Adjusted net income fell 26% to C$254 million, while operating revenues and other income declined 3% to C$4,929 million, pressured by weaker TELUS Digital results, lower mobile equipment revenues and reduced other income. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CDW Corporation (CDW) : Free Stock Analysis Report TELUS Corporation (TU) : Free Stock Analysis Report Cadence Design Systems, Inc. (CDNS) : Free Stock Analysis Report Wix.com Ltd. (WIX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

TELUS Corporation TU reported second-quarter 2026 adjusted earnings per share of C$0.16, down 27% from C$0.22 a year ago. Adjusted net income fell 26% to C$254 million, while operating revenues and other income declined 3% to C$4,929 million, pressured by weaker TELUS Digital results, lower mobile equipment revenues and reduced other income. Mobile phone ARPU slipped 0.4% to C$56.36, while churn edged up to 1.08% from 1.06%. TELUS added 17,000 mobile phone customers, 20,000 Internet customers and 187,000 connected devices. TELUS has lost 33.6% in the past year compared with the  Zacks Diversified Communication Services industry’s decline of 3.2%. Image Source: Zacks Investment Research Service revenues decreased 1% year over year to C$4,442 million. Equipment revenues fell 11% to C$478 million, reflecting lower contracted mobile volumes and weaker fixed premises equipment sales. Other income plunged 82% to C$9 million because prior-year lease and sublease revenues did not recur. Consolidated adjusted EBITDA declined 2% to C$1,777 million. However, adjusted EBITDA margin improved 30 basis points (bps) to 36.0%, as cost-reduction efforts partly countered revenue pressure. Goods and services purchased rose 1% to C$1,869 million, while employee benefits expense fell 5% to C$1,472 million. Restructuring and other costs increased 42% to C$189 million. TTech operating revenues and other income decreased 2% to C$3,746 million. Mobile network revenue rose 1% to C$1,743 million, supported by subscriber growth. Mobile equipment and other service revenues fell 13% to C$433 million, while fixed data revenue was flat at C$1,175 million and fixed voice revenue declined 8% to C$157 million. TELUS Corporation price-consensus-eps-surprise-chart | TELUS Corporation Quote TTech adjusted EBITDA was nearly unchanged at C$1,639 million. The adjusted margin expanded 110 bps to 43.8%, helped by workforce reductions, privatization synergies, lower bad-debt expense and growth in security, automation and TV. These gains offset pricing pressure, weaker equipment margins, lower business data revenue and higher cloud-related costs. TELUS Health operating revenues and other income increased 3% to C$536 million. Health service revenues rose 4% to C$533 million, driven by acquisitions, including Workplace Options, and growth in payor and provider solutions. Continued prior-year churn and pricing pressure in employer solutions limited the increase.Adjusted EBITDA advanced 1% to C$99 million, supported by revenue growth and acquisition integration synergies. The adjusted margin declined 50 bps to 18.4% because of acquisition-related costs, digital and security investments and regional marketing spending. Healthcare lives covered increased by 1.8 million to 158.9 million. TELUS Digital operating revenues and other income declined 6% to C$774 million. External revenues fell 10% to C$654 million, reflecting client ramp-downs in trust and safety and AI and data solutions, an unfavorable currency impact and a prior-year contractual receipt. Higher customer experience management volumes provided a partial offset. Adjusted EBITDA fell 20% to C$72 million, and adjusted margin contracted 160 bps to 9.2%. TELUS recorded a C$2,135 million noncash impairment of intangible assets and goodwill tied to the segment, contributing to a reported net loss of C$1,830 million and a basic loss of C$1.17 per share. Cash provided by operating activities increased 15% to C$1,342 million, aided by working-capital changes, lower income taxes paid and reduced restructuring disbursements. Free cash flow rose 2% to C$545 million despite higher interest payments and lower EBITDA. Capital expenditures were unchanged at C$678 million. The board reset the quarterly dividend by 55% to C$0.1875 per share, or C$0.75 annualized. TELUS expects about C$2.7 billion of cumulative cash savings through 2028 for debt reduction. Net debt to adjusted EBITDA was 3.5 times, with a target of approximately 3.0 times or lower by year-end 2028. TELUS now expects full-year consolidated service revenue growth to range from flat to a 2% decline versus its prior 2-4% growth forecast. Adjusted EBITDA is projected to fall 2-4%, reversing the earlier expectation for 2-4% growth, as fixed data, TELUS Digital and TELUS Health trends remain softer than planned. The company raised its 2026 capital expenditure forecast to approximately C$2.6 billion from C$2.3 billion. Free cash flow guidance was reduced to about C$1.8 billion from C$2.45 billion, reflecting lower adjusted EBITDA, higher capital spending and C$100 million of incremental cash restructuring charges. TELUS currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Exelon Corporation EXC reported second-quarter 2026 adjusted operating earnings of 43 cents per share, in line with the Zacks Consensus Estimate. Earnings increased 10.3% from 39 cents in the year-ago quarter. Higher distribution and transmission rates across several utilities supported the improvement. Revenues totaled $5.97 billion, beating the Zacks Consensus Estimate of $5.66 billion by 5.46%.  The top line increased 10% from the year-ago figure of $5.43 billion. Edison International EIX reported second-quarter 2026 core earnings of $1.54 per share, beating the Zacks Consensus Estimate of $1.02 by 51%. The bottom line surged 58.8% from 97 cents in the year-ago quarter, primarily reflecting Southern California Edison’s adoption of the 2025 General Rate Case final decision. Edison International's second-quarter operating revenues totaled $4.36 billion, which missed the Zacks Consensus Estimate of $4.72 billion by 7.7%. The top line also decreased 4.1% from the year-ago quarter’s figure of $4.54 billion. DTE Energy Company DTE delivered second-quarter 2026 earnings per share of $1.32, beating the Zacks Consensus Estimate of $1.14 by 15.8%. The bottom line, however, decreased 2.9% from the year-ago reported figure of $1.36. While the company’s operating earnings were $274 million in the quarter, down from $283 million a year ago, the path to that outcome was shaped by sizable swings across segments. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Exelon Corporation (EXC) : Free Stock Analysis Report TELUS Corporation (TU) : Free Stock Analysis Report Edison International (EIX) : Free Stock Analysis Report DTE Energy Company (DTE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in TELUS Corporation? Here are five stocks we like better. TELUS is resetting its strategy under CEO Victor Dodig, cutting its quarterly dividend by 55% to C$0.1875 and targeting approximately C$2.7 billion in cash savings through 2028 for debt reduction. The company aims to reduce net leverage from 3.5x to 3x or lower by the end of 2028 and has paused acquisitions. Second-quarter results were pressured by a C$2.1 billion non-cash impairment at TELUS Digital, reflecting faster declines in legacy services as customers automate functions with artificial intelligence. Service revenue fell 1% to C$4.4 billion and adjusted EBITDA declined 2% to C$1.8 billion, although operating cash flow rose 15%. TELUS lowered its 2026 outlook, now expecting service revenue to range from flat to down 2%, adjusted EBITDA to decline 2% to 4%, and free cash flow to be approximately C$1.8 billion. Capital expenditure expectations increased to about C$2.6 billion, partly due to AI data-center investments and higher restructuring costs. When GameStop Stock Spikes, Here's the 7 Meme Stocks That Follow TELUS (NYSE:TU) outlined a transformation plan alongside its second-quarter 2026 results, cutting its dividend, reducing its financial outlook and setting a target to lower leverage as new President and CEO Victor Dodig seeks to focus the company on its core telecommunications operations. Dodig, who became TELUS president and CEO on July 1 after previously leading CIBC, said the company will prioritize strengthening its balance sheet, tightening operational discipline and deploying capital toward profitable growth. He said TELUS expects the plan to produce minimum compounded annual free-cash-flow growth of 10% over 2027 and 2028. → Microsoft Just Flipped the AI Spending Narrative Overnight The next meme stock: 6 tickers leading a meme stock revival “Our focus is on executing with discipline and positioning TELUS to deliver sustainable, profitable growth and returns over the long term,” Dodig said. TELUS said it will reduce its quarterly dividend by 55%, to C$0.1875 per share from Oct. 1, equivalent to C$0.75 annually. The company also will end the discount associated with its dividend reinvestment plan on that date. → 2 Unique Space ETFs That Could Upend the Industry Can WeWork Become A Meme Stock Success Story? The company expects the dividend reset to generate approximately C$2.7 billion in cumulative cash savings through the end of 2028, with the funds directed toward debt reduction. TELUS also changed its dividend payout target to 45% to 60% of trailing 12-month free cash flow, compared with its prior target range of 60% to 75% on a prospective basis. TELUS reported net debt-to-adjusted EBITDA of 3.5 times as of June 30, down from 3.7 times a year earlier. Its updated target is to reduce leverage to 3 times or lower by the end of 2028. The company has also placed a moratorium on acquisitions while it works toward that target. → MarketBeat Week in Review – 07/27- 07/31 Dodig said TELUS is pursuing sales of non-core assets and is continuing work on real estate monetization. He cited the September 2025 sale of a 49.9% stake in wireless tower subsidiary Terrion to La Caisse as an example of the company’s approach. That transaction generated C$1.26 billion in proceeds and lowered leverage by 0.17 turns, according to TELUS. The company said it remains active in discussions involving certain non-core assets within TELUS Health and is progressing efforts to monetize core non-real-estate assets. Dodig said the company is reviewing its portfolio, including TELUS Ventures, but did not provide a specific dollar target for potential divestitures. For the second quarter, TELUS reported service revenue of C$4.4 billion, down 1% from a year earlier, while adjusted EBITDA declined 2% to C$1.8 billion. The company said underlying telecom performance was resilient, but results were affected by weaker performance at TELUS Digital and lower real estate gains. Cash from operations increased 15%, while free cash flow rose 2% to C$545 million. Adjusted earnings per share fell to C$0.16 from C$0.22 in the prior-year period, reflecting lower operating income and the elimination of TELUS Digital’s non-controlling interest. TELUS recorded a C$2.1 billion pre-tax, non-cash carrying-value impairment at TELUS Digital. Chief Financial Officer Gopi Chande said the writedown reflected accelerated churn in legacy services provided to certain hyperscale customers, including content moderation, ad relevancy and search-related work, as customers automate those functions using artificial intelligence. Chande said TELUS Digital is shifting toward higher-value, more complex AI datasets, though those activities have not yet offset the pace of decline in legacy services. He also said the company reassessed the growth trajectory for AI-enabling services because customer adoption has been slower than previously expected, sales cycles have lengthened and deal sizes have compressed. TELUS Digital’s customer experience management business, which accounts for more than half of the segment’s revenue, continued to show incremental growth through CXAI engagements, Chande said. TELUS Technology Solutions, or TTech, posted service revenue of C$3.3 billion and adjusted EBITDA of C$1.6 billion, both relatively flat year over year. Mobile network revenue increased 1% to C$1.7 billion, marking the third consecutive quarter of growth. Mobile net phone additions totaled 17,000, while blended mobile phone churn increased slightly to 1.08%. Postpaid churn was stable. TELUS said lower immigration and population growth have reduced the addressable market for new customer growth across the industry. Internet net additions totaled 20,000. Fixed data revenue remained stable at C$1.2 billion, supported by 2% residential growth, though the business segment faced pressure from public-sector contract changes and revenue variability. TELUS Health service revenue rose 4% to C$533 million, and adjusted EBITDA increased 1% to C$99 million. TELUS Agriculture & Consumer Goods service revenue grew 6% to C$90 million, driven by animal agriculture revenue. The company cut its full-year outlook. TELUS now expects consolidated service revenue to range from flat to down 2% in 2026, compared with its prior expectation for 2% to 4% growth. Consolidated adjusted EBITDA is expected to decline 2% to 4%, replacing the prior forecast for 2% to 4% growth. Free cash flow is now expected to be approximately C$1.8 billion for 2026, down from the prior outlook of approximately C$2.45 billion. TELUS attributed the change to lower EBITDA, higher capital expenditures and an additional C$100 million in transformation-related restructuring costs compared with its first-quarter update. Capital expenditures are now expected to total approximately C$2.6 billion in 2026, up from a prior estimate of about C$2.3 billion. Chande said the increase reflects inflation and supply-chain effects, investment in AI data center infrastructure and customer-base management initiatives. TELUS said it remains committed to reaching a multiyear capital-intensity target of 10%. The company plans to provide more detail on its cost-savings program and transformation initiatives when it reports third-quarter results in November. TELUS Corporation (NYSE: TU) is a Canadian telecommunications and technology company headquartered in Vancouver, British Columbia. It delivers a broad portfolio of consumer and business communications services across Canada, including mobile wireless, fixed-line voice, broadband internet, and television. TELUS also provides a range of enterprise services such as cloud and IT solutions, managed network services, cybersecurity and Internet of Things (IoT) offerings for business customers. Beyond core connectivity, TELUS has expanded into health and digital services. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "TELUS Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Release Date: July 31, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. TELUS Corp (NYSE:TU) reported its third consecutive quarter of mobile network revenue growth, with signs of a moderating promotional environment and stabilizing ARPU decline of less than 0.5%. The company is taking decisive action to strengthen its balance sheet, including a dividend reset expected to generate approximately $2.7 billion in cumulative cash savings for debt reduction. TELUS Corp (NYSE:TU) is advancing its asset monetization program, with active processes for TELUS Health and real estate assets, and a successful precedent set by the $1.26 billion Terion transaction. The company is committed to a clear transformation strategy focused on operational discipline, cost control, and investing in core telecom and digital infrastructure, with a target of 10% minimum compounded annual free cash flow growth. TELUS Corp (NYSE:TU) maintains a strong competitive position with its pure fiber network, 5G leadership, and growing CXAI engagements at TELUS Digital, which are proving to be an innovative edge. The company is seeing encouraging growth in TELUS Health (4% service revenue growth) and TELUS Agriculture (6% service revenue growth), with efficiency initiatives expected to improve profitability. TELUS Corp (NYSE:TU) is committed to maintaining its investment-grade credit rating and has a strong liquidity position of $2.7 billion. The new leadership team, including CEO Victor Dodig and CFO Gopi Chande, brings extensive financial and operational experience to drive the transformation. The company is investing in sovereign AI data centers, which are expected to support Canada's technological independence and drive economic prosperity with healthy margins. TELUS Corp (NYSE:TU) is focused on profitable growth, with a strategy to preserve its premium brand while using its flanker brand to compete effectively at the low end of the market. TELUS Corp (NYSE:TU) reported a significant $2.1 billion pre-tax non-cash impairment at TELUS Digital due to accelerated automation of legacy services by hyperscale clients and slower-than-expected AI adoption. The company revised its 2026 guidance downward, with consolidated service revenue now expected to be flat to down 2% and adjusted EBITDA expected to decline 2% to 4%, compared to prior growth forecasts. TELUS Corp (NYSE:TU) is facing macroeconomic headwinds, including lower immigration, which is reducing demand for core products across the industry. The company's free cash flow for 2026 is now expected to be approximately $1.8 billion, down from the previous outlook of $2.45 billion, due to lower EBITDA, higher CapEx, and restructuring costs. TELUS Corp (NYSE:TU) announced a 55% reduction in its quarterly dividend to $0.75 per share annually, which may disappoint income-focused investors. The company's leverage target of 3 times or lower has been pushed back to the end of 2028 from 2027, reflecting ongoing business headwinds. TELUS Digital is experiencing more pronounced churn in legacy services, with the second half of 2026 expected to be weaker than the first half. The company has placed a moratorium on acquisitions, limiting growth opportunities through M&A until leverage targets are met. TELUS Corp (NYSE:TU) is facing challenges in its fixed business solutions portfolio, with revenue variability and customer contract changes in the public sector. The company's 2026 CapEx is expected to increase to approximately $2.6 billion from $2.3 billion, driven by inflation, supply chain dynamics, and strategic investments, which could pressure near-term cash flows. Warning! GuruFocus has detected 8 Warning Signs with TU. Is TU fairly valued? Test your thesis with our free DCF calculator. Q: Can you unpack the 2026 adjusted EBITDA guidance revision by segment, and is Q2 indicative of what to expect from TELUS Digital in the foreseeable future? A: Gopi Chande, CFO, explained that the roughly five-percentage-point differential between the lower end of original guidance and the midpoint of current guidance breaks down as: two points related to TELUS Digital, one point to Health, one point to pausing real estate joint ventures, and one point to telecom. He noted that the telecom business is stable in H2 compared to H1, with momentum in mobility offset by fixed-line challenges. For TELUS Digital, H2 is expected to be weaker than H1 due to accelerated churn from hyperscale clients automating legacy services, though promising results are emerging from CXAI and AI data solutions. Q: Is the commitment to 10% free cash flow growth over 2027 and 2028 based on the updated 2026 guidance of $1.8 billion? A: Gopi Chande, CFO, confirmed that the 10% compounded annual free cash flow growth commitment is off the lower 2026 base. He stated that free cash flow is expected to be higher next year, driven by a return to positive EBITDA growth in the core telecom business and a commitment to reduce capital intensity. Victor Dodig, CEO, added that significant EBITDA growth and value can be unlocked by simplifying the business, with more details to be shared in Q3. Q: How much capital is TELUS willing to invest in AI, and is the TELUS Digital business essential for that investment, or could it be divested? A: Victor Dodig, CEO, stated that AI capabilities are being leveraged across all businesses, including the growing CXAI segment in TELUS Digital. He highlighted the opportunity to use these capabilities in sovereign AI data centers, which have healthy margins. He emphasized a disciplined approach to growing this business without increasing CapEx, potentially partnering with capital partners, and noted that more details on the AI data center strategy will be provided in Q3. Q: How do you think about the ARPU trajectory as TELUS focuses on profitability? A: Victor Dodig, CEO, acknowledged that ARPU decline is decelerating and aims to return to growth. He emphasized a focus on the premium brand to shore up ARPU and increase share of wallet, while using the low-cost digital-only flanker brand (Public) to compete at the low end of the market. The strategy is centered on profitable growth for every dollar of capital invested and deepening profitable customer relationships. Q: There seems to be a conflict between simplifying the business and keeping parts of Ag and Health. Can you clarify? A: Victor Dodig, CEO, clarified there is no conflict, stating that the goal is to create a much more simplified TELUS over time. He explained that the portfolio review will identify assets better off in another owner's hands, with updates provided as notable developments arise. He assured that the overwhelming majority of returns come from telecom, which will grow as a proportion of overall earnings. Q: What is the base level of EBITDA to use for 2025, given the non-recurring items? A: Gopi Chande, CFO, directed attention to the appendix (page 24) for details. He explained that other income has been pulled out of the financial statements, and the company has paused new real estate joint ventures, so no material gains are expected from that. There will be continued monetization of real estate and minor copper sales, but the specific non-recurring items from Q3 2025 are not expected to recur. Q: Can you provide more detail on the ROI of the increased 2026 CapEx to reassure investors? A: Gopi Chande, CFO, explained that the incremental CapEx is driven by inflation and supply chain dynamics, modest investments in AI data centers, and a deliberate shift towards customer base management to improve churn economics and lifetime value. He reiterated the commitment to the 10% capital intensity target and noted that some projects are being wrapped up, with a focus on simplification going forward. Q: Is there a specific total dollar figure you are looking to raise from asset monetization, and will the AI data center roadmap include detailed financial disclosures? A: Victor Dodig, CEO, declined to provide a specific dollar figure but stated that the monetization efforts, combined with CapEx maturity and business transformation, will contribute to reducing leverage to three times or lower by end of 2028. On AI data centers, he committed to providing as much transparency as possible once the roadmap is finalized, noting attractive economics in a sovereign, sustainable approach, but avoiding the "frenzy" of building without demand. Q: Have you changed or are you considering changing compensation drivers, such as adding an ROIC metric or removing volume growth metrics? A: Victor Dodig, CEO, stated his general philosophy is to align management's interests with shareholders' interests by rewarding profitable growth over time. He emphasized that the focus will be on managing the existing customer base, transforming how the business operates, and focusing on profitable growth, which will be reflected in incentive structures. He acknowledged the large reset and described it as an "abbreviated detour" as the company works intensely on course correction. Q: How do you think about TELUS Digital as part of the longer-term business, given it's been a drag? A: Victor Dodig, CEO, highlighted that TELUS Digital's capabilities serve the core telecom business and improve customer experience. The CXAI business is growing and profitable, and AI services overall present opportunities, particularly in sovereign AI data centers. He noted that the company is exploring how to grow this business without increasing CapEx, potentially through partnerships, with more details expected in Q3. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Telus (TU) came out with quarterly earnings of $0.12 per share, missing the Zacks Consensus Estimate of $0.16 per share. This compares to earnings of $0.16 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -25.00%. A quarter ago, it was expected that this telecommunications company would post earnings of $0.17 per share when it actually produced earnings of $0.17, delivering no surprise. Over the last four quarters, the company has not been able to surpass consensus EPS estimates. Telus, which belongs to the Zacks Diversified Communication Services industry, posted revenues of $3.55 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 2.29%. This compares to year-ago revenues of $3.67 billion. The company has not been able to beat consensus revenue estimates over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Telus shares have lost about 18.2% since the beginning of the year versus the S&P 500's gain of 8.7%. While Telus has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Telus was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.17 on $3.76 billion in revenues for the coming quarter and $0.72 on $14.96 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Diversified Communication Services is currently in the bottom 5% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Lumen (LUMN), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 4. This telecommunications is expected to post quarterly loss of $0.15 per share in its upcoming report, which represents a year-over-year change of -400%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Lumen's revenues are expected to be $2.75 billion, down 11.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report TELUS Corporation (TU) : Free Stock Analysis Report Lumen Technologies, Inc. (LUMN) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Dividend reset realigned with capital priorities with clear path to 3.0-times or lower leverage by year-end 2028 Dividend reinvestment plan discount to be removed effective October 1, 2026, reducing shareholder dilution VANCOUVER, BC, July 31, 2026 /CNW/ -- TELUS Corporation (TSX: T) (NYSE: TU) today released its unaudited results for the second quarter ended June 30, 2026. Concurrent with its quarterly results, TELUS is announcing three near-term strategic priorities, a reset of its quarterly dividend, planned removal of the dividend reinvestment plan (DRIP) discount and revised full-year financial guidance that reflects the company's financial priorities and its commitment to long-term value creation and balance sheet strength. An overview of TELUS' second quarter 2026 results is discussed below. Highlights Introduced three near-term strategic financial and operational priorities to guide TELUS' performance and capital allocation going forward including: Strengthen the financial foundation; Hone operational discipline and reinvest in the core business; and Deploy resources to drive profitable, sustainable growth and returns. See "Strategic Financial and Operational Priorities" below for further details. Delivered mobile phone and internet net additions of 17,000 and 20,000, respectively, reflect a disciplined strategy prioritizing value-accretive customer growth; connected device net additions of 187,000. Mobile network revenue of $1.7 billion is up 1 per cent year-over-year, supported by subscriber base growth and ARPU of $56.36, declining at a decelerating rate of 0.4 per cent through a focus on premium brand customer loading. Achieved blended mobile phone churn of 1.08 per cent, up from 1.06 per cent in the same period last year. Net loss of $1.8 billion due to a pre-tax, non-cash intangible asset and goodwill impairment of $2.1 billion in the second quarter, reflecting a reduction in the recoverable amount of the TELUS Digital cash-generating unit. See "Second Quarter Financial Results Overview" below for further details. Consolidated service revenue of $4.4 billion declined 1 per cent reflecting lower TELUS Digital growth, partially offset by continued mobile network revenue growth and higher TELUS Health revenues. Adjusted EBITDA of $1.8 billion declined 2 per cent, which reflects varied results across our reportable segments and lower real estate gains. See "Second Quarter Financial Results Overview" below for further details. Capital expenditures of $678 million were recorded in the second quarter; full-year capital expenditures have been updated to approximately $2.6 billion, reflecting inflation and supply chain dynamics impacting customer premises equipment, strategic investment directed towards our sovereign AI data centres, including network infrastructure upgrades and site enablement, and additional investments directed towards customer base management; TELUS remains committed to its 10 per cent capital intensity target. Cash provided by operating activities of $1.3 billion increased 15 per cent and free cash flow of $545 million is higher by 2 per cent, driven by decreased net income taxes paid and lower lease payments, partially offset by increased interest paid and lower Adjusted EBITDA. TELUS' Board of Directors declared a quarterly dividend of $0.1875 per common share, representing a reset of 55 per cent to an annualized amount of $0.75 per share, which is expected to generate approximately $2.7 billion in cumulative cash savings through 2028 directed toward debt reduction; the DRIP discount will be removed effective October 1, 2026. Net debt to Adjusted EBITDA of 3.5-times at quarter-end; TELUS is targeting approximately 3.0-times or lower by year-end 2028, supported by organic free cash flow growth, the dividend reset, disciplined capital expenditures and proceeds from asset monetization processes currently underway. Full-year consolidated service revenue guidance revised to a range of flat to negative 2 per cent; consolidated Adjusted EBITDA is now expected to be in a range of negative 2 to negative 4 per cent; and full-year free cash flow is anticipated to be approximately $1.8 billion. See "2026 Financial Outlook" below for further details. "TELUS is built on a foundation of genuine strength – leading networks, sustained customer loyalty and growing expertise in health and AI-enabling capabilities that are increasingly central to how Canadians live and work. The macro environment has shifted and we are responding with clarity and discipline. Today we are announcing three strategic priorities that will strengthen our financial foundation, sharpen our operational focus and concentrate our resources on the opportunities where TELUS is best positioned to win – all in service of delivering long-term, profitable and sustainable growth," said Victor Dodig, President and Chief Executive Officer. "I am proud to be working alongside our experienced and capable leadership team and our 100,000 passionate and professional team members across TELUS to execute on these strategic priorities, delivering improved experiences for our customers and opening opportunities for our people, and creating value for our shareholders. Our focus is on disciplined execution and ensuring maximum returns on every dollar of capital we deploy. Everything I have seen since stepping into this role has only deepened my conviction – in this team and the admirable culture they have built, as well as the bright future ahead for TELUS," said Mr. Dodig. "The actions we are taking establish the financial conditions for strong, profitable growth and durable, compounding free cash flow growth," said Gopi Chande, Chief Financial Officer. "In combination, the dividend reset, termination of the DRIP discount and proceeds from our monetization initiatives provide a path to achieve our leverage and free cash flow objectives. Our commitment to reducing capital intensity, combined with a disciplined focus on operational efficiency across the business, reinforce that path further. The strategic changes we are making to how this company generates and deploys cash will compound to create lasting value for our shareholders." Strategic Financial and Operational PrioritiesWith the TELUS PureFibre® network build approaching completion and capital intensity expected to decline over the multi-year horizon, TELUS has identified three near-term financial and operational priorities to guide its performance and capital allocation going forward. These are: Strengthen the financial foundation. TELUS is prioritizing balance sheet flexibility and a sustainable capital returns framework. This includes reducing net debt to Adjusted EBITDA to approximately 3.0-times or lower by year-end 2028, supported by the dividend reset, disciplined capital expenditures and proceeds from asset monetization processes currently underway. Hone operational discipline and reinvest in the core. TELUS will intensify its focus on deploying invested capital where returns exceed the cost of capital. This includes a cost transformation program designed to embrace technology, eliminate redundancy and sharpen the company's focus on customer service excellence and its core competitive strengths. Deploy resources to drive profitable, sustainable growth and returns. TELUS will concentrate investment where it has the strongest competitive position and clearest path to returns – including its wireless and TELUS PureFibre networks, and the digital and AI infrastructure that supports Canada's technological independence and economic prosperity. A more detailed outline of the capital returns framework and corporate strategy will be provided with TELUS' third quarter 2026 results in November. Dividend Reset and Financial PoliciesThe TELUS Board of Directors declared a quarterly dividend of $0.1875 per share on the issued and outstanding Common Shares of the company payable on October 1, 2026, to holders of record at the close of business on September 10, 2026, representing a reset of 55 per cent to an annualized amount of $0.75 per share. The prior annualized amount was $1.6736 per share. The revised dividend is expected to generate approximately $2.7 billion in cumulative cash savings through 2028, directed toward deleveraging. TELUS also updated its free cash flow dividend payout ratio to a range of 45 to 60 per cent of trailing 12-month free cash flow, from a prior range of 60 to 75 per cent of free cash flow on a prospective basis. As part of resetting the dividend, TELUS has also terminated the DRIP discount, effective October 1, 2026. Shareholders currently enrolled do not need to take any action if they continue to participate in the DRIP; dividends will continue to be reinvested automatically under the revised terms. The company had previously targeted net debt to Adjusted EBITDA of approximately 3.0-times or lower by year-end 2027. The revised timeline to year-end 2028 reflects the impact of competitive pricing pressure and reduced subscriber demand amid lower population growth on organic free cash flow generation. The 3.0-times or lower target itself is unchanged. TELUS expects leverage to decline sequentially in 2027 and 2028, supported by organic free cash flow growth, declining capital intensity, the dividend reset and proceeds from the strategic portfolio review processes currently underway. Strategic Portfolio ReviewTELUS is conducting a comprehensive review of its asset portfolio to optimize capital allocation, with proceeds from these processes directed toward debt reduction. As part of this effort, the company remains active in the market on TELUS Health‑related non‑core assets and is in discussions with interested parties. Similarly, the company is also advancing the monetization of non-core real estate assets. These initiatives are expected to drive further deleveraging and support the company's long-term financial objectives. Additional details will be shared as notable developments arise. Second Quarter Financial Results OverviewConsolidated operating revenues and other income were $4.9 billion, compared with $5.1 billion in the prior year, reflecting a consolidated service revenue decline of 1 per cent, as well as lower mobile equipment revenue and Other income. A decline in consolidated service revenue was largely as a result of: (i) lower external revenues in TELUS Digital; (ii) mobile phone ARPU declining at a decelerating rate; and (iii) declines in fixed legacy voice revenue. These factors were partially offset by: (i) mobile subscriber base growth; (ii) higher TELUS Health service revenues; (iii) increased fixed data services revenue; and (iv) greater agriculture and consumer goods services revenues. See 'Second quarter 2026 Operating Highlights' within this news release for a discussion on TELUS' reportable segment results for TTech, TELUS Health and TELUS Digital. In the quarter, TELUS recognized a non-cash impairment of $2.1 billion relating to TELUS Digital, as the recoverable amount of the TELUS Digital cash-generating unit was less than its carrying amount as at June 30, 2026. See Note 18(b) of the interim consolidated financial statements for additional details. TELUS recognized a net loss of $1.8 billion and a basic loss per share of $1.17, reflecting the after-tax impacts of a decline in Operating income and greater Financing costs. When excluding certain costs and other adjustments (see 'Reconciliation of adjusted Net income' in this news release), compared to the same period last year, adjusted Net income of $254 million decreased by 26 per cent, while adjusted basic EPS of $0.16 was down 27 per cent. Adjusted Net income is a non-GAAP financial measure and adjusted basic EPS is a non-GAAP ratio. For further explanation of these measures, see 'Non-GAAP and other specified financial measures' in this news release. Compared to the same period last year, consolidated EBITDA decreased by 5 per cent to $1.6 billion. Adjusted EBITDA declined by 2 per cent to $1.8 billion reflecting varied results across our reportable segments. See 'Second quarter 2026 Operating Highlights' within this news release for a discussion on segmented Adjusted EBITDA results. Our TTech subscriber base of 17.9 million connections increased by 6 per cent over the past 12 months, reflecting a 1 per cent growth in our mobile phones subscriber base to 10.3 million, a 20 per cent increase in our connected devices subscriber base to 4.8 million, and a 3 per cent growth in our internet subscriber base to 2.8 million. In TELUS Health, healthcare lives covered were 158.9 million as of the end of the second quarter of 2026, an increase of 1.8 million net of churn over the past 12 months, mainly reflecting growth in our family assistance programs across all operating regions, in addition to ongoing demand for virtual solutions. Cash provided by operating activities of $1.3 billion increased by 15 per cent in the second quarter of 2026, primarily driven by other working capital changes, a decrease in income taxes paid, and lower restructuring and other costs disbursements. These factors were partially offset by an increase in interest paid and lower EBITDA. Free cash flow of $545 million increased by 2 per cent compared to the same period a year ago, largely driven by decreased net income taxes paid and lower lease payments, partially offset by increased interest paid and reduced EBITDA. Consolidated capital expenditures of $678 million were flat in the second quarter of 2026. Capital expenditures in support of TTech operations of $614 million increased by $44 million, primarily from greater capital investments in developing new facilities to meet growing industry demand. TELUS Health capital expenditures of $44 million decreased by $15 million, largely driven by decreased investments in clinic expansions and business acquisitions. TELUS Digital capital expenditures of $34 million decreased by $9 million, mainly driven by prior year software license investment and decreased site expansions in Europe. As at June 30, 2026, our 5G network covered approximately 34.2 million Canadians, representing over 92 per cent of the population. Consolidated Financial Highlights Second quarter 2026 Operating Highlights TELUS technology solutions (TTech) TTech operating revenues (arising from contracts with customers) decreased by $54 million or 1 per cent in the second quarter of 2026, primarily reflecting lower mobile equipment revenue, as described below. TTech EBITDA decreased by $22 million or 1 per cent in the second quarter of 2026, while TTech Adjusted EBITDA was relatively flat reflecting: (i) lower Other income, largely due to the impact of the comparative period's non-recurring lease and other sublease revenue; (ii) mobile phone ARPU declining at a decelerating rate; (iii) lower B2B data services revenue; (iv) fixed legacy voice decline; (v) lower mobile equipment margins; (vi) increased costs of subscription-based licences and cloud usage; and (vii) lower residential internet revenue per customer. These factors were mostly offset by: (i) subscriber base growth across mobile and internet; (ii) cost reduction efforts, including workforce reductions and synergies achieved from the privatization of TELUS Digital; (iii) security and automation growth; (iv) TV growth; (v) lower bad debt expense; and (vi) increased agriculture and consumer goods margin as a result of growth in animal agriculture revenue. In addition to the drivers discussed within TTech Adjusted EBITDA above, EBITDA also reflected an increase in restructuring and other costs of $21 million in the second quarter of 2026, as a result of cost efficiency and effectiveness programs. Mobile products and services Mobile network revenue increased by $20 million or 1 per cent in the second quarter of 2026, largely due to growth in our mobile phone subscriber base, supported by ARPU declining at a decelerating rate. Mobile equipment and other service revenues decreased by $65 million in the second quarter of 2026, due to a reduction in contracted volumes, partially offset by the impact of higher-value smartphones in the sales mix. TTech mobile products and services direct contribution increased by $21 million in the second quarter of 2026, reflecting stronger mobile network revenue and subscriber base growth. These factors were partially offset by a decline in mobile equipment margin from lower contracted volumes, in addition to mobile phone ARPU declining at a decelerating rate. Mobile phone ARPU was $56.36 in the second quarter of 2026, a decrease of $0.22 or 0.4 per cent, as the continued positive impact of ongoing efforts to moderate ARPU declines was offset by the adoption of base rate plans with lower prices in response to continuing competitive promotional pricing targeting both new and existing customers, a decline in roaming revenues, and the commoditization of telecommunications services in the public sector. We have noted sustained growth in the adoption of unlimited data and Canada-U.S.-Mexico plans, which generate higher and more stable ARPU on a monthly basis while also offering customers greater cost certainty in lower roaming fees to the U.S. and Mexico, and lower data overage fees, respectively. Mobile phone gross additions were 348,000 in the second quarter of 2026, reflecting a decrease of 28,000. This decrease was driven by a greater emphasis on premium and profitable loading. Our mobile phone churn rate was 1.08 per cent in the second quarter of 2026, compared to 1.06 per cent in the second quarter of 2025. The increase was largely as a result of customer switching decisions in response to continuing marketing and promotional price competition. Mobile phone net additions were 17,000 in the second quarter of 2026, a decrease of 38,000, driven by lower gross additions, prioritizing value-accretive customer growth. Connected device net additions were 187,000 in the second quarter of 2026, an increase of 75,000, driven by lower deactivations in the transportation and connectivity industries. Fixed products and services Fixed data services revenues increased by $5 million in the second quarter of 2026, driven by growth in our internet subscriber base, and TV and security and automation revenues. This was partially offset by lower B2B data services revenue, and lower residential internet revenue per customer. Fixed voice services revenues decreased by $13 million in the second quarter of 2026, reflecting the ongoing decline in legacy voice revenues. This was partially mitigated by the effects of our successful customer retention efforts. Fixed equipment and other service revenues decreased by $6 million in the second quarter of 2026, driven primarily by lower premises equipment sales. TTech fixed products and services direct contribution decreased by $4 million in the second quarter of 2026, primarily driven by legacy voice decline, lower B2B data services revenue, and lower residential internet revenue per customer. These factors were partially offset by continued growth in internet subscribers, security and automation, and TV from programming savings and higher revenue. Internet net additions were 20,000 in the second quarter of 2026, a decrease of 7,000, primarily driven by higher internet churn, and lower gross loading. Agriculture and consumer goods services Agriculture and consumer goods services revenues increased by $5 million in the second quarter of 2026, largely as a result of growth in animal agriculture revenues. TELUS Health Health services revenues increased by $19 million in the second quarter of 2026, driven by: (i) global business acquisitions in employer solutions and retirement and benefits solutions, including the acquisition of Workplace Options in May 2025; and (ii) growth in payor and provider solutions, with strong performance in collaborative health records and an increase in recurring revenue related to our electronic medical records solutions, increased patient health records and health benefits management, and virtual pharmacy solutions. These factors were offset by an organic decline in employer solutions driven by the continued impact of prior year churn and pricing pressure. TELUS Health direct contribution increased by $8 million in the second quarter of 2026, reflecting revenue growth as described above. TELUS Health EBITDA decreased by $16 million or 17 per cent in the second quarter of 2026, while TELUS Health Adjusted EBITDA increased by $1 million or 1 per cent, reflecting revenue growth, as well as the ongoing realization of acquisition integration synergies. These factors were partially offset by higher indirect costs related to: (i) global business acquisitions; (ii) the scaling of our digital and security capabilities, inclusive of digital transformation; and (iii) higher regional marketing costs. The difference between the growth rate of EBITDA and Adjusted EBITDA is attributable to higher restructuring and other costs related to cost efficiency and effectiveness programs. Healthcare lives covered were 158.9 million as of the end of the second quarter of 2026, an increase of 1.8 million, net of churn over the past 12 months, mainly reflecting growth in our EFAP across all of our operating regions, in addition to the ongoing demand for virtual solutions. TELUS Digital TELUS Digital operating revenues (arising from contracts with customers) decreased by $75 million in the second quarter of 2026, primarily attributable to: (i) client ramp-downs in our trust and safety service line, coupled with a one-time receipt in the comparative period resulting from a client's change in contractual scope; (ii) client ramp-downs in our AI and data solutions service line; and (iii) an overall unfavourable foreign currency impact on our operating results, primarily due to the strengthening of the Canadian dollar against the U.S. dollar. This decrease was partially offset by an increase in service volume within our customer experience management service line. TELUS Digital EBITDA decreased by $35 million in the second quarter of 2026, while TELUS Digital Adjusted EBITDA decreased by $17 million or 20 per cent. The decrease in EBITDA was primarily due to: (i) lower Operating revenues; and (ii) increased restructuring and other costs related to cost efficiency programs associated with client ramp-down from service delivery centres out of Europe. 2026 Financial OutlookTELUS is providing the following updated financial guidance for the full year 2026: Consolidated service revenue is now expected to be flat to negative 2 per cent for the full year, as positive trends in mobility are being offset by pressure in other parts of our business, including fixed data, TELUS Digital and slower than anticipated growth in TELUS Health. Consolidated Adjusted EBITDA is now expected to decline by 2 to 4 per cent, reflecting lower revenue growth which no longer will offset the non-recurring benefits realized in 2025, including real estate gains, acquisition-related adjustments and favourable one-time expense reductions. Capital expenditures for 2026 are now expected to be approximately $2.6 billion, reflecting inflation and supply chain dynamics impacting customer premises equipment, strategic investment directed towards our sovereign AI data centres, including network infrastructure upgrades and site enablement, and additional investments directed towards customer base management. These are factors specific to 2026 and are not indicative of a broader shift in capital discipline. TELUS remains committed to reducing capital intensity over the multi-year horizon and will provide an update on the next step-down with its third quarter 2026 results. Free cash flow for 2026 is now expected to be approximately $1.8 billion, reflecting lower Adjusted EBITDA, higher capital expenditures and incremental cash restructuring charges of $100 million (relative to our first quarter update) associated with the cost transformation program. Please see "Caution regarding forward-looking statements" below for a description of the assumptions on which our financial outlook is based and the risks that could cause our actual results to differ materially from this outlook. Corporate and Community HighlightsTELUS continues to make significant contributions to the Canadian economy and the communities it serves. In the first half of 2026, TELUS paid, collected and remitted approximately $1.2 billion in taxes and regulatory fees to federal, provincial and municipal governments, invested $1.3 billion in capital expenditures primarily in communities across Canada, disbursed spectrum renewal fees in excess of $50 million to Innovation, Science and Economic Development Canada in the first half of 2026, and generated a total team member payroll of $2 billion. Since 2000, TELUS has remitted more than $50 billion in total taxes and spectrum fees and invested over $60 billion in Canadian infrastructure. In May 2026, TELUS celebrated the 21st anniversary of its annual TELUS Days of Giving, with a record-breaking 100,000 volunteers participating in 35 countries. The TELUS Friendly Future Foundation supported 294,000 youth through nearly $4.5 million in cash donations and bursaries in the first six months of 2026. Since 2000, TELUS and its team members have contributed more than $1.85 billion in cash, in-kind contributions, time and programs to communities across Canada and around the world. In the first half of 2026, TELUS was recognized as one of the top 10 most valuable brands in Canada by Brand Finance, named to the Corporate Knights Best 50 Corporate Citizens in Canada in third place, and ranked as the most sustainable North American telecommunications company by TIME Magazine. Further details on TELUS' community investment programs, environmental sustainability initiatives, and social impact metrics are available in the Company's second quarter 2026 MD&A and at telus.com. Access to quarterly results information Interested investors, the media and others may review this quarterly earnings news release, MD&A, financial statements, quarterly results slides, audio and transcript of the investor webcast call, supplementary financial information at telus.com/investors. TELUS' second quarter 2026 conference call is scheduled for Friday, July 31, 2026 at 12:30 pm ET (9:30 am PT) and will feature prepared remarks and a slide presentation followed by a question and answer period with investment analysts. Interested parties can access the webcast at telus.com/investors. An archive of the webcast and presentation will be available on telus.com/investors and an audio recording will be available approximately 60 minutes after the call until October 1, 2026 at 1-855-201-2300. Quote conference access code 60535# and playback access code 60535#. A transcript will be posted on the website within a few business days. Caution regarding forward-looking statementsThis news release contains forward-looking statements about expected events and our financial and operating performance. Forward-looking statements include any statements that do not refer to historical facts. They include, but are not limited to, statements relating to our revised full-year financial outlook (including guidance regarding capital expenditures and capital intensity, free cash flow, consolidated service revenue and consolidated Adjusted EBITDA); the expected results from our three strategic imperatives; expectations regarding our capital returns framework and corporate strategy, including capital intensity and investment plans; our dividend payout ratio range, expected impact of our dividend reset and the termination of the discount under our DRIP; our targeted net debt to Adjusted EBITDA ratio and expectations regarding leverage; and the results of our strategic portfolio review processes. Forward-looking statements are typically identified by the words, assumption, goal, guidance, objective, outlook, strategy, target and other similar expressions, or verbs such as aim, anticipate, believe, could, expect, intend, may, plan, predict, seek, should, strive and will. These statements are made pursuant to the "safe harbour" provisions of applicable securities laws in Canada and the United States Private Securities Litigation Reform Act of 1995. By their nature, forward-looking statements are subject to inherent risks and uncertainties and are based on assumptions, including assumptions about future economic conditions and courses of action. These assumptions may ultimately prove to have been inaccurate and, as a result, our actual results or other events may differ materially from expectations expressed in, or implied by, the forward-looking statements. The assumptions on which our 2026 outlook is based, as described in Section 9 in our 2025 annual MD&A, remain the same, except for the updates below as well as our estimates regarding economic growth, inflation, unemployment and housing starts, as discussed in Section 1.2 in our second quarter 2026 MD&A. Our restructuring and other costs assumption has been revised to approximately $900 million, from approximately $500 million. The increase is a result of expanded operational effectiveness programs to support EBITDA and cash flow growth. We estimate total cash restructuring and other disbursements of approximately $650 million, from approximately $450 million. Our cash income tax payments assumption has been revised downward to a range of approximately $240 million to $340 million from a range of approximately $540 million to $620 million. This decrease was primarily due to higher refunds received, Canadian Bill C-15 receiving royal assent on March 26, 2026, and lower required income tax instalments attributable to lower income before income taxes. Risks and uncertainties that could cause actual performance or events to differ materially from the forward-looking statements made herein and in other TELUS filings include, but are not limited to, the following: Regulatory matters. We operate in a number of highly regulated industries and conduct business in many jurisdictions and are therefore subject to a wide variety of laws and regulations domestically and internationally. Policies and approaches advanced by elected officials and regulatory decisions, reviews and other government activity may have strategic, operational and/or financial impacts (including on revenue and free cash flow).Risks and uncertainties include: Competitive environment. Competitor expansion, activity and intensity (pricing, including discounting, bundling), as well as non-traditional competition, disruptive technology and disintermediation, may alter the nature of the markets in which we compete and impact our market share and financial results (including revenue and free cash flow). The reduction in the number of new permanent and temporary residents in Canada may intensify competitive pressure. Different areas of our business including TELUS Health and TELUS Digital also face intense competition in the different markets in which we compete. Technology. Consumer adoption of alternative technologies and changing customer expectations have the potential to impact our revenue streams and customer churn rates.Risks and uncertainties include: Security and data protection. Our ability to prevent, detect and identify potential threats and vulnerabilities depends on the effectiveness of our security controls in protecting our infrastructure and operating environment, and our timeliness in responding to attacks and restoring business operations. A successful attack may impede the operations of our network or lead to the unauthorized access to, interception, destruction, use or dissemination of, customer, team member or business information and confidential data. The necessary use of sensitive personal information by our business may expose us to the risk of non-compliance with applicable law in a jurisdiction or compromise perceptions of our brand. Generative AI (GenAI). GenAI exposes us to numerous risks, including risks related to operational reliability, responsible AI usage, data privacy and cybersecurity, the possibility that our use of AI may generate inaccurate or inappropriate content or create negative perceptions among customers, the risk that we may not develop and adopt AI technologies effectively and could fail to achieve improved efficiency through our use of GenAI or that the use of AI could reduce demand for our services, and that regulation could affect future implementation of AI. Climate and the environment. Natural disasters, pandemics, disruptive events and the effects of climate change may impact our operations, customer satisfaction and team member experience. Our goals to achieve carbon neutrality and reduce our greenhouse gas (GHG) emissions in our operations are subject to our ability to identify, procure and implement solutions that reduce energy consumption and adopt cleaner sources of energy, our ability to identify and make suitable investments in renewable energy, including in the form of virtual power purchase agreements, and our ability to continue to realize significant absolute reductions in energy use and the resulting GHG emissions from our operations. Operational performance, business combinations and divestitures, and TELUS Digital privatization. Investments and acquisitions present opportunities to expand our operational scope, but may expose us to new risks. We may be unsuccessful in gaining market traction/share or in integrating acquisitions into our operations within expected timelines or at all, we may not realize the expected benefits of acquisitions, and integration efforts may divert resources from other priorities. There is no assurance that we will realize any or all of the anticipated benefits of the privatization of TELUS International (Cda) Inc. in the timeframe anticipated or at expected cost levels, that we will be able to drive cross-selling opportunities, or that our estimates and expectations in relation to future economic and business conditions and the resulting impact on growth and various financial metrics will prove to be accurate.Risks relating to operational performance include: Our systems and processes. Systems and technology innovation, maintenance and management may impact our IT systems and network reliability, as well as our operating costs.Risks and uncertainties include: Our team. The rapidly evolving and highly competitive nature of our markets and operating environment, along with the globalization and evolving demographic profile of our workforce, and the effectiveness of our internal training, development, succession and health and well-being programs, may impact our ability to attract, develop and retain team members with the skills required to meet the changing needs of our customers and our business. Team members may face greater mental health challenges associated with the significant change initiatives at the organization, which may result in the loss of key team members through short-term and long-term disability and churn. Integration of international business acquisitions and concurrent integration activities may impact operational efficiency, organizational culture and engagement. Suppliers. We may be impacted by supply chain disruptions and lack of resiliency in relation to global or local events. Dependence on a single supplier for products, components, service delivery or support may impact our ability to efficiently meet constantly changing and rising customer expectations while maintaining quality of service. Our suppliers' ability to maintain and service their product lines could affect the success of upgrades to, and evolution of, technology that we offer. Real estate matters. Real estate investments are exposed to possible financing risks and uncertainty related to future demand, occupancy and rental rates, especially following the pandemic. Future real estate developments may not be completed on budget or on time and may not obtain lease commitments as planned. We may be exposed to the risk of loss in relation to our investments if the business plans of our real estate joint venture developments are not successfully executed. Financing, debt and dividends. Our ability to access funding at optimal pricing may be impacted by general market conditions and changing assessments in the fixed-income and equity capital markets regarding our ability to generate sufficient future cash flow to service our debt. Failure to complete planned deleveraging initiatives or to achieve the anticipated benefits of those initiatives could increase our cost of capital. Our current intention to pay dividends to shareholders could constrain our ability to invest in our operations to support future growth.Risks and uncertainties include: Tax matters. Complexity of domestic and foreign tax laws, regulations and reporting requirements that apply to TELUS and our international operating subsidiaries may impact financial results. International acquisitions and expansion of operations heighten our exposure to multiple forms of taxation. The economy. Changing global economic conditions, including a potential recession and varying expectations about inflation, as well as our effectiveness in monitoring and revising growth assumptions and contingency plans, may impact the achievement of our corporate objectives, our financial results (including free cash flow), and our defined benefit pension plans. Geopolitical uncertainties and changes in trade policies and agreements, including tariffs or trade restrictions, could increase our costs, disrupt our supply chains and adversely affect our operations and financial results. They present a risk of recession and may cause customers to reduce or delay discretionary spending, impacting new service purchases or volumes of use, and to consider substitution by lower-priced alternatives. Litigation and legal matters. Complexity of, and compliance with, laws, regulations, commitments and expectations may have a financial and reputational impact.Risks include: These risks and the assumptions underlying our forward-looking statements are described in additional detail in Section 9 General trends, outlook and assumptions, and regulatory developments and proceedings and Section 10 Risks and risk management in our 2025 annual MD&A. Those descriptions are incorporated by reference in this cautionary statement but are not intended to be a complete list of the risks that could affect the Company, or of our assumptions. Additional risks and uncertainties that are not currently known to us or that we currently deem to be immaterial may also have a material adverse effect on our financial position, financial performance, cash flows, business or reputation. Except as otherwise indicated in this document, the forward-looking statements made herein do not reflect the potential impact of any non-recurring or special items or any mergers, acquisitions, dispositions or other business combinations or transactions that may be announced or that may occur after the date of this document. Readers are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements in this document describe our expectations, and are based on our assumptions, as at the date of this document and are subject to change after this date. Forward-looking statements in this release, in particular regarding our financial outlook, are presented for the purpose of assisting our investors and others in understanding certain key elements of our expected 2026 financial results as well as our objectives, strategic priorities and business outlook. Such information may not be appropriate for other purposes. We disclaim any intention or obligation to update or revise any forward-looking statements except as required by law. This cautionary statement qualifies all of the forward-looking statements in this document. Non-GAAP and other specified financial measuresWe issue guidance on and report certain non-GAAP measures that are used to evaluate the performance of TELUS, as well as to determine compliance with debt covenants and to manage our capital structure. As non-GAAP measures generally do not have standardized meanings, they might not be comparable to similar measures disclosed by other issuers. Securities regulations require that such measures be clearly defined, qualified and reconciled with their nearest GAAP measure. Certain of the metrics do not have generally accepted industry definitions. Adjusted Net income and adjusted basic earnings per share (EPS): These are non-GAAP measures that do not have any standardized meanings prescribed by IFRS Accounting Standards and are therefore unlikely to be comparable to similar measures presented by other issuers. Adjusted Net income excludes the effects of restructuring and other costs, real estate rationalization-related restructuring impairments, income tax-related adjustments, long-term debt prepayment premium, and other adjustments (identified in the following tables). Adjusted basic EPS is calculated as adjusted Net income divided by the basic weighted-average number of Common Shares outstanding. These measures are used to evaluate performance at a consolidated level and exclude items that, in management's view, may obscure underlying trends in business performance or items of an unusual nature that do not reflect our ongoing operations. They should not be considered as alternatives to Net income and basic EPS in measuring TELUS' performance. Reconciliation of adjusted Net income Reconciliation of adjusted basic EPS EBITDA (earnings before interest, income taxes, depreciation and amortization): We issue guidance on and report EBITDA because it is a key measure used to evaluate performance at a consolidated level. EBITDA is commonly reported and widely used by investors and lending institutions as an indicator of a company's operating performance and ability to incur and service debt, and as a valuation metric. EBITDA should not be considered as an alternative to Net income in measuring TELUS' performance, nor should it be used as a measure of cash flow. EBITDA as calculated by TELUS is equivalent to Operating revenues and other income less the total of Goods and services purchased expense and Employee benefits expense. We calculate Adjusted EBITDA by excluding items of an unusual nature that do not reflect our ongoing operations and should not, in our opinion, be considered in a long-term valuation metric or should not be included in an assessment of our ability to service or incur debt. Free cash flow: We report this measure as a supplementary indicator of our operating performance, and there is no generally accepted industry definition of free cash flow. It should not be considered as an alternative to the measures in the condensed interim consolidated statements of cash flows. Free cash flow excludes certain working capital changes (such as trade receivables and trade payables), proceeds from divested assets and other sources and uses of cash, as reported in the condensed interim consolidated statements of cash flows. It provides an indication of the amount of cash generated by operations that is available after capital expenditures and may be used for discretionary purposes, among other things, to pay dividends, repay debt, purchase shares or make other investments. Free cash flow may be supplemented from time to time by proceeds from divested assets or financing activities. Mobile phone average revenue per subscriber per month (ARPU) is calculated as network revenue derived from monthly service plan, roaming and usage charges; divided by the average number of mobile phone subscribers on the network during the period and is expressed as a rate per month. Appendix Operating revenues and other income – TTech segment Operating revenues and other income – TELUS health segment Operating revenues and other income – TELUS digital experience segment About TELUS TELUS (TSX: T, NYSE: TU) is a leading Canadian communications technology company operating in more than 45 countries and generating over $20 billion in annual revenue with more than 17 million customer connections through our advanced suite of broadband services for consumers, businesses and the public sector. TELUS is passionate about putting our customers and communities first, leading the way globally in client service excellence and social capitalism. The TELUS PureFibre and 5G networks connect Canadians at home, at work and in the communities where they live.TELUS Health is enhancing approximately 159 million lives across 200 countries and territories through innovative preventive medicine and well-being technologies. TELUS Agriculture & Consumer Goods utilizes digital technologies and data insights to optimize the connection between producers and consumers. TELUS Digital specializes in digital customer experiences and future-focused digital transformations that deliver value for their global clients. Since 2000, TELUS and our team members have contributed more than $1.85 billion in cash, in-kind contributions, time and programs to communities across Canada and around the world. For more information, visit telus.com. Investor RelationsIan [email protected] Media RelationsSteve [email protected] View original content to download multimedia:https://www.prnewswire.com/news-releases/telus-reports-second-quarter-2026-financial-and-operational-results-and-resets-quarterly-dividend-to-support-deleveraging-and-fuel-long-term-growth-302839766.html