BCE

• Strategic Execution & Core Business Performance

  • Postpaid wireless churn improved 4 bps YoY to 1.02%, the lowest quarterly level in three years, driven by customer experience and retention initiatives. Monthly recurring ARPU increased 0.7% YoY, reflecting a higher-value customer mix.
  • Fiber delivered strong net subscriber growth: 45,000+ residential FTTH net adds in Canada, bringing total North American residential FTTH net adds to nearly 55,000, driving 14.2% internet revenue growth. Bell received multiple third-party awards for Canada's most reliable internet and fastest 5G+ network.
  • Launched new always-on internet solutions (wireless and power backup) to improve customer service resilience.

• Growth Initiatives: US Fiber Expansion

  • Ziply Fiber build activity is on track to ramp significantly in H2 2026. Permit submissions increased fourfold from April to June 2026, with contractor capacity and fiber supply secured for the ramp. 75% of 2027 expansion locations have received state-level approvals, and 60% have completed high-level engineering. Fiber penetration remains on track with the original investment case.

• Growth Initiatives: Bell AI Fabric

  • Bell now has ~335 megawatts of contracted AI data center capacity, with construction progressing on all announced projects. The Winnipeg facility remains on track to enter service in H2 2026, while the Saskatchewan 300 megawatt facility's first phase is on track for H1 2027 operations, and Merit Phase 2 is expected to launch in early 2027. The company has line of sight to 800 total megawatts of capacity, with a medium-term plan to reach 373 contracted megawatts by 2028.
  • Demand for AI-powered enterprise solutions (Ateco, Bell Cyber) remains strong, with combined revenue up 29% YoY.

• Growth Initiatives: Bell Media

  • 2026 FIFA World Cup coverage delivered record viewership, with the final drawing an average of 6.4 million viewers, the most-watched World Cup match in Canadian history. The tournament drove strong advertising and streaming engagement, with matches consistently ranking among Crave's most popular content.

• Balance Sheet & Capital Allocation

  • Net debt leverage ratio improved to ~3.7x at quarter-end, down 0.1x from Q4 2025. BCE completed $2.5 billion in public debt offerings and repurchased discounted debt, supporting deleveraging. Total available liquidity reached $4.6 billion, and defined benefit pension plans have a $4.9 billion solvency surplus with a 125% solvency ratio.

• Management reconfirms all 2026 full-year financial guidance targets, with Q2 2026 free cash flow tracking in line with expectations.
• The company remains on track to achieve its target net debt leverage ratio of 3.5x by the end of 2027.
• Canadian telecom capital spending (excluding Bell AI Fabric investments) continues to decline year-over-year, consistent with the company's multi-year disciplined capital reduction plan.
• Ziply Fiber remains on track to reach 3 million fiber passings by the end of 2028.

1. Bell CCS Canada: Adjusted EBITDA margin improved 40 bps year-over-year to 46.1%, with operating costs down 4.7% YoY. Bell Business Markets underlying revenue grew 3.4% YoY, driven by 29% combined YoY growth in Ateco and Bell Cyber AI-powered solutions revenue. Wireless product revenue declined 6.6% YoY due to disciplined hardware discounting and a market shift to BYOD activations. The segment delivered 41,594 postpaid mobile phone net ads, 45,271 residential FTTH internet net ads, and 8,741 video net ads (compared to a 15,851 net loss YoY).
2. Bell CTS US (Ziply Fiber): Revenue was broadly stable sequentially, as fiber growth in consumer and small business segments offset legacy copper/voice declines and wholesale headwinds. Adjusted EBITDA was $95 million, with a 40.6% margin (temporary compression from higher subscriber acquisition activity tied to strong net subscriber growth). Ziply delivered 99,600 residential net ads, its highest quarterly total since BCE's acquisition.
3. Bell Media: Total revenue grew 8.9% YoY, and adjusted EBITDA grew 3.8% YoY. Advertising revenue increased 5.3% YoY driven by strong FIFA World Cup advertiser demand, while subscriber revenue grew 6.7% YoY led by direct-to-consumer streaming growth. Digital video advertising revenue grew 39% YoY, and total digital revenue rose 6% YoY. Crave reached 5.1 million total subscribers, up 23% YoY, with 49% YoY growth in direct-to-consumer subscribers.

No explicit material new risks or operational failures were discussed during the call. Management noted that forward-looking statements are subject to standard risks and uncertainties that could cause actual results to differ materially, as referenced in the company's pre-call safe harbor disclosure and publicly filed documents.

Q: Why has Saskatchewan AI data center CapEx been shifted from Q2/Q3 to primarily Q3/Q4, and does this reflect a construction delay? / A: There is no change to the overall construction timeline. The majority of equipment has already been ordered on schedule, but CapEx is only reported when cash is actually spent. This shift purely reflects payment timing, not construction delays, and all delivery schedules remain on budget and on time. The project is fully on track for first phase operations in H1 2027.

Q: Ziply Fiber has seen flat overall revenue for three quarters as legacy declines offset fiber growth. When will the H2 2026 build ramp translate to visible top-line growth? / A: Management remains focused on executing the fiber build and growing the fiber footprint first, as subscriber growth and revenue will follow. Gross fiber ads were up 25% quarter-over-quarter, and penetration remains exactly on plan. Temporary margin pressure from higher subscriber acquisition costs is a worthwhile trade for long-term revenue growth. The recent revenue flatness was partially driven by larger-than-normal wholesale contract impacts, which are not expected to be ongoing. The build will continue to ramp through H2 2026 and 2027, with financial results improving as the fiber footprint grows.

Q: Given strong demand tailwinds for AI data centers, would BCE increase CapEx to expand the pipeline beyond the current 800 megawatt target? / A: Management's current priority is executing on the already announced projects, starting with the flagship Saskatchewan facility. BCE has clear line of sight to 800 megawatts total capacity, with 335 megawatts already contracted. As additional capacity is contracted to reach the 800 megawatt target, BCE will fund the expansion consistent with its prior transparent guidance. The company only deploys capital for AI data centers where it has structural competitive advantages (network infrastructure, enterprise relationships) to drive shareholder value.

Q: What is constraining the Ziply Fiber build to date, and will accelerated permit submissions lead to faster approvals and build out? / A: The main constraint to date has been the shift to expanding into new incumbent territory, which requires new planning, state and local permits, and engineering work. Permit submissions increased fourfold from April to June, with 75% of 2027 locations already securing state approvals and 60% completing high-level engineering. Contractor capacity and fiber supply are already secured for the approved build funnel. The build is on track to ramp significantly in H2 2026 and continue accelerating into 2027, with the company on track to hit the 3 million fiber passing target by 2028.