TELUS Cuts 2023 Outlook Reflecting TELUS International's Revised Outlook

TELUS Corp TU disclosed an updated 2023 guidance following a revised 2023 outlook for TELUS International (Cda) Inc TIXT.

TU guidance: The company reduced the 2023 outlook for operating revenue growth to 9.5%-11.5% (from 11%-14%) and adjusted EBITDA growth to 7%-8% (from 9.5%-11%). 

TIXT Q2 preliminary: The company expects revenue of $660 million-$668 million, reflecting growth of 6%-7% Y/Y on both the reported and constant currencies basis and a decline of around 1%  (excluding WillowTree related revenues). 

Adjusted EBITDA is projected to be $117 million-$120 million in Q2, reflecting a 20%-22% Y/Y decline and an adjusted EBITDA Margin of 17.7%-18.0%, impacted by higher-than-expected costs and temporary demand imbalances across several geographies.

Adjusted EPS is projected to be $0.15-$0.17 range in Q2, reflecting a decrease of 43%-50% Y/Y.

TIXT 2023 outlook: For 2023, TIXT now projects revenue of $2.700 billion-$2.730 billion, adjusted EBITDA of $575 million-$600 million, and adjusted EPS of $0.90-$0.97.

"Total Mobile and Fixed customer growth of 293,000, was up 46,000 over last year, and represents our strongest second quarter on record. This was driven by strong demand for our leading portfolio across Mobility and Fixed services, backed by our industry-best customer experience, and world-leading wireless and wireline broadband PureFibre networks," said Darren Entwistle, President and CEO of TELUS, and Chair of the TI Board of Directors.

Also Read: TELUS Invests C$81B Across Canada For Network Advancement

TELUS plans to release Q2 results on August 4, 2023.

Price Action: TU shares closed higher by 1.30% at $19.48 on Thursday.