New Telus CEO slashes dividend as first step in major remake as company posts a $1.8 billion Q2 loss

Victor Dodig speaks during an interview in 2022, when he was president and chief executive officer of CIBC. Photo by Christopher Katsarov Luna /Bloomberg

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Telus Corp. has unveiled the start of a transformation of its business under new CEO Victor Dodig, which includes reducing debt, returning to core business functions, and looking to sovereign artificial data centres for future growth.

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“There’s a need for greater simplicity at Telus and a return to our roots,” Dodig said during a conference call on Friday with analysts, as he embarked on a new strategic direction. He took over from long-time CEO Darren Entwistle at the end of June.

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The new top boss promised that the changes ahead will see Telus adopt tighter financial discipline and sell off non-core businesses under a streamlined corporate structure.

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However, while Dodig heralded Telus’ strengths at the outset of his promised transformation, financial results released Friday indicate challenges ahead.

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Incoming chief financial officer Gopi Chande characterized operating results as stable, but the company posted a $1.8 billion loss in the second quarter as it absorbed a $2.1 billion writedown of its Telus Digital business.

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Before the writedown, Telus saw an operating profit of $1.6 billion, which was down five per cent from the same quarter a year ago, on revenue of $4.9 billion, which was down two per cent from 2025. And the company’s revised outlook is for flat revenue growth in the year ahead.

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“While results reflect good underlying performance in mobility, with network revenue continuing to improve, they were offset primarily by weaker results in Telus Digital,” Chande said on the conference call.

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Dodig is taking over Telus after Entwistle’s 26-year reign at the helm. Dodig set out three priorities for the company’s makeover: strengthening its balance sheet, tightening up financial discipline, then devoting the capital that frees up room to invest in profitable and sustainable growth, including in AI data centres.

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The first step Dodig took to repair the balance sheet was to slash the company’s dividend 55 per cent to 18.75 cents per share, or 75 cents on an annual basis, which would free up $2.7 billion as “a direct action to accelerate that path to lower debt.”

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“Our second-quarter 2026 results and our 2026 guidance update underscore a company that is in active transition, leveraging our strengths and addressing challenges to position Telus for long-term success,” Dodig said.

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The initial response of investors, however, was negative as Telus shares fell $1.70, 11 per cent, to close at $13.38 per share in trading Friday on the Toronto Stock Exchange.

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Telus hired Dodig, formerly CEO of CIBC, to revamp operations in a way that will turn the company’s stock performance around.

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All three of Canada’s major telecoms have seen their share prices battered by investors in recent years. Bell Canada’s share price is down 6.4 per cent so far in 2026. Rogers Communications is down almost nine per cent.

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Telus’ decline, however, has been steepest at almost 26 per cent since the start of the year.