Bell Canada Enterprises (BCE) reported higher net earnings in the fourth quarter but added fewer wireless subscribers than expected and forecast a decline in earnings per share for 2025. The company cited competitive pressures, lower subscriber loading, and increased media costs as headwinds.
Bell Canada Enterprises ( BCE ) reported higher net earnings in the fourth quarter but added fewer wireless subscribers than anticipated and projected a decline in earnings per share for 2025. The company anticipates 2025 revenue to range from a 1% increase to a 3% decrease. It forecasts an adjusted earnings per share decline of 8% to 13%. CEO Mirko Bibic attributed the wide range to macroeconomic and competitive pressures, particularly in pricing over the past 18 to 24 months.
BCE cited ongoing competition in wireless and broadband, lower subscriber loading, increased media costs, higher interest expense, and a larger number of common shares outstanding due to a discounted dividend reinvestment plan. These challenges were partially offset by reduced planned capital expenditures resulting from a slowdown in fiber deployment and operational efficiencies. The company expects free cash flow growth between 11% and 19%. In its fourth quarter ending December 31, Bell added 56,550 net new postpaid wireless customers, a 56% decrease from the 128,715 customers added last year. Analysts had predicted the company to add 64,000. Mr. Bibic acknowledged the highly competitive environment and record-low pricing. He also pointed to slowing immigration and fewer housing starts as additional headwinds for the industry. Despite some analysts suggesting a dividend reduction to strengthen its long-term financial position, BCE maintained its dividend payout of $3.99 per share for 2025. While previously stating its intention to maintain the dividend until payout and net debt leverage ratios reached target ranges, Mr. Bibic indicated the company would continue to evaluate the dividend based on macroeconomic, competitive, and regulatory factors. Some analysts interpreted this as a possibility of a dividend cut in coming quarters. BCE's high-yield stock, widely held by retail investors, has recently paid out more in dividends than the company earned in free cash flow. BCE's dividend yield has recently hovered around 11%, an unusually high level suggesting many investors view it as unsustainable. Analysts estimate these assets could be worth billions. Mr. Bibic stated that the company would review opportunities to expand its U.S. fibre footprint beyond the pending acquisition of Ziply Fibre, but only if it could secure third-party capital to reduce funding requirements.
BCE Earnings Dividend Competition Telecommunications Fiber Wireless Broadband
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