Subscriber Stagnation: How Immigration Policies Are Shaking Canadian Telecoms

The Canadian telecommunications sector, long fueled by a booming population and steady immigration, now faces a pivotal challenge. For Rogers Communications, Canada’s largest wireless provider, declining mobile subscriber growth in 2025 has been unequivocally tied to government policies restricting immigration—a demographic shift with ripple effects across the industry. This article dissects the interplay between policy, population dynamics, and telecom performance, and what it means for investors.

The Immigration Link: A Shrunken Market

Rogers’ Q1 2025 mobile net additions plummeted to 34,000 from 61,000 the prior year, with CEO Tony Staffieri explicitly citing reduced immigration as a driver. Newcomers—foreign students, temporary workers, and permanent residents—have historically been a key growth segment. By Q3, this cohort’s contribution had collapsed by 40% year-over-year. The data is stark: Canada’s non-permanent and permanent immigration intake dropped from 2.3 million (2022–2023) to an estimated 800,000 in 2024, with plans to cap non-permanent residents at 5% of the population by 2026. Analysts at Bank of America warn this could make wireless subscriber growth “volatile,” as immigrants once accounted for 15–20% of new mobile contracts annually.

Beyond Immigration: Travel Declines and Strategic Shifts

Reduced cross-border travel has further strained revenue. Roaming income, once buoyed by Canadians visiting the U.S., fell sharply. Combined with heightened competition, this contributed to a 15% drop in average revenue per user (ARPU). Meanwhile, Rogers’ pivot to premium 5G services—shifting customers from budget brands like Chatr and Fido—has slowed gross additions. Postpaid net additions fell to 101,000 in Q3 2025 from 225,000 in 2023, though the postpaid base grew to nearly 10.7 million.

Financial Resilience Amid Headwinds

Despite these challenges, Rogers’ adjusted EBITDA rose 6% in Q3 to $2.55 billion, benefiting from cost efficiencies and synergies from its Shaw Communications acquisition. Total revenue held steady at $4.976 billion in Q1, driven by media ventures like the Toronto Blue Jays. Yet net income grew only 9% to $280 million in Q3, underscoring margin pressures. To address debt, Rogers raised $7 billion via equity financing, aiming to reduce leverage to 3.7x by year-end.

Industry-Wide Implications

While Rogers leads the narrative, the broader telecom sector faces parallel pressures. Reduced immigration shrinks the market’s “new entrant” segment, and slower population growth—projected to average 0.7% annually through 2030—adds to saturation concerns. Analysts caution that competitors like Bell and Telus, though less vocal about immigration’s impact, are also navigating a shrinking addressable market.

Conclusion: A Crossroads for Telecom Investors

The data paints a clear picture: Canadian telecom firms are increasingly vulnerable to external policy shifts. With immigration levels expected to stay low, subscriber growth will hinge on organic penetration and premium upselling—a strategy that may boost margins but risks alienating budget-conscious users. Rogers’ media diversification and infrastructure investments (e.g., its $4.7 billion stake in Maple Leaf Sports & Entertainment) signal a move beyond traditional telecoms, but these ventures are no substitute for core wireless growth.

Investors must weigh two realities:
1. Policy Risk: A 5% cap on non-permanent residents by 2026 could permanently reduce subscriber inflows, making future growth reliant on price hikes or costly technological upgrades (e.g., 5G adoption).
2. Market Saturation: With Canada’s wireless penetration at ~105% (due to multi-line households), the sector’s growth ceiling is nearing.

The verdict? Telecom stocks like Rogers may remain stable in the near term due to consistent EBITDA and media revenue, but long-term investors should demand clarity on how companies plan to navigate a smaller, slower-growing market. For now, the telecom sector’s golden era of easy subscriber growth is over—a shift that could redefine the industry’s value proposition.