Telus Q2 Net Profit Rises 7% on Smartphone Growth

Telus has announced their Q2 earnings, and their net profit rose 7% thanks largely in part to its wireless and Internet TV segments. Their growth outpaced rivals Rogers and Bell, and the company says that is a result of rapid smartphone sales such as the iPhone, that continues to increase data revenue and subscriber growth:

Telus added 94,000 wireless customers in the quarter, a decline from the number signed up a year earlier but ahead of the average estimate of analysts. Wireless revenue rose 10 percent and wireless data revenue increased 49 percent.

But the cost of activations rose 8 percent to C$370 each as the industry subsidized the cost of providing smartphones for new subscribers. For BCE Inc’s (BCE.TO) Bell Canada, new activations cost even more at C$400 each, a 19 percent increase.

Carriers continue to offer large subsidies on the latest handsets, in exchange for users signing up for three year contracts. These subsidies don’t come cheap though, and is a double-edged sword for those who agree to them.