Bell Added More Wireless Customers in Q3, But They’re Paying Less

Bell parent BCE released its third quarter earnings on Thursday, showing stronger wireless customer growth and fewer cancellations, even as the company continues to collect less revenue per phone line.

Bell added 24,110 postpaid phone customers during the quarter, more than double the 11,511 it added a year earlier. That also puts it ahead of rival Rogers, which added just 6,000 postpaid customers over the same period.

The company credited the improvement to more prepaid customers switching to postpaid plans, a long-term government mobile contract and fewer customers leaving. Its postpaid churn rate fell to 1.06 per cent, the lowest third quarter level in four years. Rogers reported a slightly lower rate of 1.03 per cent.

Still, Bell said Canada’s wireless market remains relatively quiet. Gross activations, which measure new sign-ups before cancellations, fell 6.1 per cent as promo activity slowed and population growth remained limited.

Prepaid growth also weakened, as Bell added 29,579 prepaid customers, down from 56,507 a year earlier. The company pointed to fewer international students, slower population growth and more prepaid users moving to postpaid plans.

Bell ended September with 10.43 million mobile phone customers, essentially unchanged from a year ago.

The bigger challenge is how much money Bell makes from each customer. Average revenue per user fell 1.7 per cent to $57.07, down from $58.04 last year.

Bell blamed part of that decline on lower connection fees following the CRTC’s ban on certain customer fees, along with reduced overage and roaming revenue. Wireless service revenue declined, although Bell said pricing on base rate plans across the industry was now “much more disciplined.”

Bell’s product revenue rose 6.9 per cent to $770 million, driven by equipment sales to large business customers. Consumer wireless device sales, however, declined.

Across the company, quarterly revenue increased 2.2 per cent to $6.18 billion, while adjusted EBITDA edged up 0.9 per cent. Net earnings dropped 84.6 per cent to $701 million, largely because last year’s results included a major gain from the sale of Bell’s MLSE stake.

Outside wireless, Bell added 67,199 fibre-to-the-home internet customers across Canada and the U.S., including Ziply Fiber. Internet revenue grew 5.1 per cent.

Bell Media revenue climbed 9.7 per cent, helped by the FIFA World Cup and Crave. The streaming service saw subscriptions jump 21 per cent to 5.15 million, ahead of its Black Friday promotion.

Bell also highlighted its agreement to sell a 49.9 per cent stake in its wireless tower business to La Caisse. Meanwhile, the company has completed its first satellite ground station in Québec and is now testing connectivity with AST SpaceMobile satellites.

For Bell customers, the results show a carrier holding on to more subscribers even as wireless revenue comes under pressure. Telus will report its Q3 numbers tomorrow, so stay tuned for that.

Are you staying with Bell, or looking for a better wireless deal this fall? Let us know in the comments.