BCE shares closed down $1.12, or 2.8 percent, at $38.94 on Thursday – the first time since 2012 that the company’s shares have closed below $40.

Earlier today, BCE announced that its net loss attributable to common shareholders was $1.24 billion, or $1.36 per share, for the quarter ended September 30.

That compares with a profit of $640 million, or 70 cents per share, a year earlier. On an adjusted basis, BCE earned 75 cents per share, compared to adjusted earnings of 81 cents per share in the same quarter last year.

The company shared its latest quarterly results a day after being denied an appeal against a partial CRTC ruling last year that allows small Internet service providers to sell services to their customers over the company’s fiber-optic network. Bell in Ontario and Quebec.

Although this temporary decision has since been extended to all of Canada, Bell had asked the federal cabinet to review the regulator’s preliminary decision. He argued that the CRTC’s direction, while intended to spur competition for Internet services, reduces its incentive to continue developing its fiber optic network.

Industry Minister François-Philippe Champagne said in a statement Wednesday evening that Bell’s request to “cancel or modify” the decision had been rejected.

“Achievable wholesale access to fiber optic networks is needed. The CRTC acted quickly to improve competition through this and other decisions arising from its broad review of Internet competition,” Champagne said in a statement.

“The government commends the CRTC for quickly launching a review of the wholesale regime last year and welcomes the CRTC’s important decision to open wholesale access to high-speed fiber optic networks.

A separate appeal of that decision filed by Bell with the Federal Court of Appeal was withdrawn by the company after the CRTC announced in August that its decision would apply to national networks starting next February.

BCE CEO Mirko Bibic said Thursday that Bell is a “fiber-first company,” with technology “at the heart of what we do.”

He said Bell continues to work toward its fiber buildout goal of reaching 8.3 million locations by the end of next year, calling it a growth area for the company.

This is despite BCE reducing its capital spending by more than $1 billion between 2024 and 2025, including a reduction of more than $600 million since the start of the year.

Earlier in the week, the company announced it had signed an agreement to buy U.S. fiber Internet provider Ziply Fiber for approximately $5 billion in cash, using approximately $4.2 billion in net proceeds from the sale of its stake in Maple Leaf Sports & Entertainment to help pay for it. the agreement.

“You need to align your cost structure with the declining segments, to align the cost of revenue,” Bibic said.

“If certain assets were to decline perpetually, we could abandon those lines of business, such as certain radio stations. We are quite diligent in managing declining segments…and we continue to invest aggressively in growth areas.

The company reported Thursday that its third-quarter operating revenue was $5.97 billion, down from $6.08 billion in the third quarter of 2023. BCE also said it now expects its 2024 revenue to fall by about 1.5 percent compared to earlier forecasts of a zero to four percent increase.

The move comes as BCE faces lower-than-expected wireless product revenues and sustained pressure on wireless service pricing.

BCE added 33,111 net postpaid mobile subscribers, down 76.8 percent from the same period last year, marking the company’s second-best performance on this metric since 2010.

It said the decline was due to higher churn – a measure of how many subscribers canceled their service – amid increased competition and promotional offers. BCE’s monthly churn rate for this category was 1.28 percent, up from 1.1 percent during the previous third quarter.

“I’m not happy with the churn situation. I don’t think anyone would get those numbers,” Bibic said, adding that the company was facing “what is arguably the most competitive market we’ve seen.”

“It is a market reality that consumers continue to search for deals given the sustained and aggressive promotional offers that exist in the market. So because of that, you’re going to see a lot of change activity.

BCE also saw an 11.6 percent decline in gross subscriber activations. Average revenue per user (ARPU) for Bell’s wireless mobile phones was $58.26, down 3.4 percent from $60.28 in the third quarter last year.

But Bibic said the company has been “very diligent about the customers we attract,” encouraging customers to sign up for its premium Bell brand rather than discounted alternatives it owns, like Virgin Mobile.

He said BCE “does not pursue every load at all costs, because that is not a winning formula.”

CFO Curtis Millen added that the company “intentionally slowed subscriber acquisition…so as not to lock customers into low ARPU contracts.”

Scotiabank analyst Maher Yaghi said BCE’s churn levels increased “significantly more than expected” – an issue that will need to be addressed quickly “to stabilize financial performance from further deterioration”.

“We are squarely focused on what 2025 will bring given the company’s weaker operational performance in the wireless sector, as we head into a typically busy and competitive holiday season,” Yaghi said in a statement. note.

This report by The Canadian Press was first published November 7, 2024.

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