TELUS (T) investor relations material

Executive summary

• Leadership transition with new CEO and CFO, and a renewed strategic focus on strengthening the financial foundation, operational discipline, and sustainable growth.

• Transformation strategy centers on simplifying business structure, focusing on core telecom and digital infrastructure, and restoring balance sheet strength.

• Strategic priorities include reducing leverage, investing in core infrastructure, and supporting a sustainable dividend.

• Dividend reset by 55% to $0.1875 per share quarterly, and removal of DRIP discount effective October 1, 2026, targeting $2.7 billion in cash savings through 2028 for deleveraging.

• Revised full-year guidance reflecting a challenging macro environment and competitive pressures.

Financial highlights

• Q2 2026 service revenue was CAD 4.4 billion (or $4,442M), down 1% year-over-year; adjusted EBITDA was CAD 1.8 billion (or $1,777M), down 2%.

• Adjusted EPS was CAD 0.16, down from CAD 0.22 a year ago; basic EPS negative due to a CAD 2.1 billion TELUS Digital impairment.

• Free cash flow rose 2% to CAD 545 million; cash from operations increased 15%.

• Net loss of $1.8 billion due to a $2.1 billion non-cash impairment in TELUS Digital.

• CapEx for Q2 was $678 million; full-year capex guidance raised to ~$2.6 billion.

Outlook and guidance

• 2026 consolidated service revenue expected flat to -2%; adjusted EBITDA expected -2% to -4%.

• Previous guidance was for 2%-4% growth in both metrics.

• Free cash flow for 2026 now anticipated at approximately CAD 1.8 billion, down from prior outlook of CAD 2.45 billion.

• Committed to minimum 10% compounded annual free cash flow growth in 2027 and 2028, off the 2026 base.

• Targeting net debt-to-adjusted EBITDA of 3x or lower by end of 2028.