Rogers Communications (NYSE:RCI) increased free cash flow by 65% to C$1.37 billion in the third quarter as lower spending helped strengthen its balance sheet.
The Canadian telecoms and media group reaffirmed its 2026 outlook for service revenue, adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), capital expenditure and free cash flow.
Revenue rose 2% to C$5.44 billion in the three months to 30 September, while adjusted EBITDA increased 1% to C$2.54 billion.
Capital expenditure fell 46% to C$524 million, reducing capital intensity, the proportion of revenue spent on capital investment, to 9.6% from 18% a year earlier.
Rogers generated C$3.13 billion of free cash flow in the first nine months of 2026, up 34% year on year, while cash from operating activities increased 6% to C$4.67 billion.
The company is targeting further debt reduction by the first half of 2027 through the planned sale of a minority interest in its sports, media and entertainment assets.
Rogers completed the C$4.35 billion acquisition of the remaining 25% stake in Maple Leaf Sports & Entertainment (MLSE) on October 1, giving it full ownership of the business.
MLSE owns the Toronto Maple Leafs ice hockey team, Toronto Raptors basketball team and Toronto FC football club, alongside Scotiabank (TSX:BNS) Arena and other sports and entertainment assets.
Rogers intends to use proceeds from the planned minority stake sale to repay debt, with its debt leverage ratio standing at 3.7 times adjusted EBITDA at the end of September.
The group's wireless business delivered a 1% increase in adjusted EBITDA, while its margin expanded to 68% as higher equipment margins offset pressure on service revenue.
Wireless service revenue fell 1% to C$2.03 billion, reflecting competitive pricing pressure and lower fee income following regulatory changes, while mobile phone net additions weakened.
Cable service revenue remained broadly stable at C$1.98 billion, although adjusted EBITDA increased 1% as operational efficiency measures lifted the segment's margin to 58.6%.
Media revenue rose 9% to C$821 million, supported by stronger sports revenue and higher subscriptions for the Warner Bros Discovery channel portfolio, while adjusted EBITDA increased 12% to C$84 million.
Net income fell 91% to C$495 million, largely reflecting a C$5 billion non-cash gain recognised in the prior-year quarter when Rogers revalued its existing MLSE investment following an earlier transaction.
Adjusted net income declined 3% to C$701 million as higher financing costs partly offset the improvement in adjusted EBITDA.
