Telus Corp. (NYSE:TU) shares are tumbling Friday after the Canadian telecommunications giant delivered a second-quarter report that fell short on every major metric and unveiled a dividend reduction of more than half. Here’s what you should know.

• TELUS shares are approaching critical lows. What’s pressuring TU?

A Double Miss and a 55% Dividend Cut Send Shares Lower

Second-quarter earnings of 12 cents per share came in nearly 30% below the 17 cents the Street had anticipated and marked a 25% retreat from the 16 cents posted in the comparable period a year earlier.

Revenue of $3.561 billion fell 5.3% short of the $3.760 billion consensus and declined 4% from the $3.71 billion generated twelve months prior. Total consolidated service revenue of $4.4 billion contracted 1% from the prior year as softness in the TELUS Digital business overshadowed modest gains in mobile network revenue and a stronger contribution from TELUS Health.

Adjusted EBITDA of $1.8 billion contracted 2%, pressured by uneven performance across the company’s operating segments and a smaller contribution from real estate transactions.

The dividend announcement hit income-oriented investors particularly hard. The board trimmed the quarterly payout to a little less than 19 cents per common share, chopping the distribution by 55% and reducing the annualized rate to 75 cents per share.

The company said the lower payout is expected to free up roughly $2.7 billion in cumulative cash through 2028, money that will be redirected entirely toward paying down debt. The dividend reinvestment plan discount is also being eliminated starting Oct. 1.

Guidance Revised Sharply Lower Across Every Category

The updated full-year forecast delivered another blow. Consolidated service revenue, which the company had expected to grow between 2% and 4%, is now projected to land anywhere from flat to down 2%. Adjusted EBITDA guidance swung from anticipated growth of 2% to 4% to an expected contraction of 2% to 4%.

Capital expenditure plans were raised to approximately $2.6 billion from the prior $2.3 billion as inflation, supply chain complications affecting customer equipment and incremental spending on sovereign AI data center infrastructure and network upgrades pushed costs higher. Full-year free cash flow guidance was pulled down to approximately $1.8 billion from a prior target of $2.45 billion, a reduction of $650 million.

Incoming CEO Victor Dodig framed the sweeping changes as the foundation of a deliberate reset, outlining three priorities built around fortifying the balance sheet, tightening operational discipline and channeling resources toward the areas of the business where the company holds the strongest competitive position.

TU Shares Are Plummeting

TU Price Action: Telus shares were down 12.63% at $9.41 at the time of publication on Friday. The stock is trading at a new 52-week low, according to Benzinga Pro.

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