Cogeco Communications sees low-single-digit decline in 2025 revenue

Cogeco Communications sees low-single-digit decline in 2025 revenue

Cogeco Communications Inc. (TSX: CCA) has announced its financial results for the third quarter ended May 31, 2025, and provided updated fiscal 2025 financial guidelines. The company reported continued strength in Canadian Internet customer growth and the launch of its Canadian wireless service, with a first cohort of users already on the service and expansion into 12 Canadian markets over the coming weeks [1].

Revenue for the third quarter decreased by 2.7% to $730.7 million, with a 4.1% decrease in constant currency terms. This decline was primarily attributed to a drop in subscriber base and a higher proportion of Internet-only services in the American telecommunications segment, as well as a competitive pricing environment in the Canadian segment [1].

Adjusted EBITDA decreased by 0.9% to $362.4 million, with a 2.4% decrease in constant currency terms. The decrease was mainly due to lower revenue in both segments, offset by lower operating expenses driven by cost reduction initiatives and operating efficiencies [1].

Profit for the period amounted to $73.3 million, with $69.9 million attributable to owners of the Corporation. Free cash flow increased by 63.2% to $143.9 million, mainly due to lower net capital expenditures and acquisition, integration, restructuring, and other costs [1].

Cogeco Communications has revised its fiscal 2025 financial guidelines to reflect a low-single-digit decline in revenue, stable adjusted EBITDA, lower net capital expenditures, and higher free cash flow compared to previously issued financial guidelines. The company expects additional pressure on its revenue, particularly in the United States, driven by increased competition [1].

The revised financial guidelines anticipate a stable free cash flow and lower net capital expenditures and capital intensity projections. The company's three-year transformation program has initiated several cost reduction initiatives and operating efficiencies across the organization to minimize the revenue impact on adjusted EBITDA and reduce net capital expenditures [1].

In conclusion, Cogeco Communications is facing revenue pressure, particularly in the United States, but remains focused on cost reduction and efficiency improvements to maintain its financial health.

References:

[1] https://www.newswire.ca/news-releases/cogeco-communications-announces-q3-2025-financial-results-and-canadian-wireless-launch-865693844.html