Earnings Call Transcript - RCI Q3 2025

Operator, Operator

Thank you for your patience. This is the conference operator. Welcome to the Rogers Communications, Inc. Third Quarter 2025 Results Conference Call. The conference is being recorded. I will now turn the call over to Paul Carpino, Vice President of Investor Relations at Rogers Communications. Please proceed, Mr. Carpino.

Paul Carpino, Vice President of Investor Relations

Thank you, Galyene, and good morning, everyone, and thank you for joining us. Today, I'm here with our President and Chief Executive Officer, Tony Staffieri; and our Chief Financial Officer, Glenn Brandt. Today's discussion will include estimates and other forward-looking information from which our actual results could differ. Please review the cautionary language in today's earnings report and in our 2024 annual report regarding the various factors, assumptions and risks that could cause our actual results to differ. With that, let me turn it over to Tony to begin.

Anthony Staffieri, CEO

Thank you, Paul, and good morning, everyone. It's been quite a week for our Toronto Blue Jays, American League Champions, so I just wanted to say a few words about Canada's team. We're thrilled. The Blue Jays are in the World Series, and it all starts north of the border tomorrow. As owner, our job is to give leadership the tools and resources to win. And as Canada's communications and entertainment company, we're about providing Canadians with the best sports and entertainment experiences. This is one of those moments, and this is what Rogers is all about. Let me now turn to the quarter. Q3 was another strong quarter for Rogers. We delivered industry-best combined mobile phone and Internet customer additions. We continue to grow our Cable business anchored by Canada's most reliable Internet. We again delivered the best Wireless and Cable margins in our sector, and we're seeing healthy revenue growth from our Media operations through organic growth and through now including MLSE revenue in our results. Overall, we executed with discipline and a clear focus on driving growth across our three main businesses. Let me start with Wireless. In the highly competitive Wireless market, we saw some pressure on service revenue and ARPU. Our priority continues to be on the consistent delivery of results. We added 111,000 total mobile phone net additions in Q3 and year-to-date, we added 206,000 mobile subscribers with the vast majority on the Rogers postpaid brand. We are leading the industry with innovative, transparent, feature-rich add-a-line plans. These plans meet the dual objective of providing customers with simple value-add options while targeting revenue growth opportunities to support strategic investments in our network. We are also leading the industry with satellite to mobile. This new groundbreaking technology connects Canadians in remote areas, and we now deliver three times more coverage than any other carrier in Canada. Since launching our beta trial in July, we have seen terrific response from both our customers and Canadians. We recently extended the beta trial and will launch even more capabilities in the coming months. The launch of satellite to mobile reinforces our 65-year history of leading the industry and innovating for Canadians. Our customers are embracing the strategic approach. Our postpaid churn in the quarter was 0.99%, down 13 basis points year-on-year and the lowest churn in over two years. We are leading in innovation and delivering more value for our customers while maintaining industry-leading Wireless margins of 67%. In Cable, growth remains positive, reflecting a clear reversal of the negative trends seen in previous years. Retail Internet additions were 29,000 in the quarter, and we have delivered approximately 80,000 new Internet subscribers year-to-date across the country. This is in part driven by Rogers leading 5G home Internet technology. 5G Home Internet is one of many areas where we're leading. With the Xfinity roadmap, we're rolling out new features and plans that drive value and deliver new innovations on our world-class entertainment platform. We've launched Rogers Xfinity StreamSaver to bring together popular streaming services at a price point that's attractive to the consumer. We've launched more smart home devices and new features for Rogers Xfinity self-protection. We were the first Canadian Internet provider to introduce WiFi 7, the latest generation of WiFi technology. Our focus on execution, efficiency and discipline continues to drive industry-leading Cable margins of 58%. Finally, in Media, revenue growth was up 26% driven by a strong Blue Jays regular season and the consolidation of MLSE results. We are in the early stages of transforming our Sports & Entertainment business into one of the best sports businesses globally. This is our third pillar of growth beyond Wireless and Cable and will be meaningful to Rogers over time. With the acquisition of the additional stake in MLSE, we have added revenue and profitability growth to our core business. Taking a step back, in calendar 2025, we project Media revenue and adjusted EBITDA, including MLSE for the full year to be $4 billion and $250 million, respectively. Our collection of Sports and Media assets has a value in excess of $15 billion and is among the most impressive in the world. This value is not currently reflected in our share price. We are well positioned to surface this significant unrecognized value for Rogers shareholders over time. In 2026, we expect to acquire the outstanding minority state in MLSE as part of this process, so more to come on this. We are building a sports business at scale, and we are assessing multiple options to unlock additional value. We will take the time to be thoughtful, deliberate and get it right. In the meantime, we will continue to operate with financial discipline while providing team leadership with the tools and resources to build championships. Finally, on the balance sheet and capital spending, we are effectively managing leverage down even as we scale up our exceptional asset base. In Q3, we continue to execute on our commitment to maintain a strong balance sheet. We reported a debt leverage ratio of 3.9 times. This was achieved after completing the acquisition of the additional stake in MLSE. As you saw this morning, we now expect CapEx for the current year to come in at $3.7 billion. This is below our previous target of $3.8 billion and reflects the current regulatory environment. Free cash flow is now expected to be between $3.2 billion and $3.3 billion, higher than our previous target. In the coming quarters, we will maintain our laser-like focus on preserving a strong, investment-grade balance sheet even as we complete our transformational investments. As we pursue growth in our three core businesses, we will continue to align capital spending and free cash flow growth to the best growth opportunities and balance sheet deleveraging priorities. As we get ready for peak selling in the fourth quarter, we will remain focused on balancing execution discipline with revenue and subscriber growth. Thank you to our exceptional team for their continued commitment to drive growth long term. I will now turn the call over to Glenn.

Glenn Brandt, CFO

Thank you, Tony, and good morning, everyone. Thank you for joining us. We are pleased to report that Rogers' Third Quarter results reflect another quarter of strong, disciplined, and leading financial and operating performance. Once again, we have delivered industry-leading margin performance in Cable and Wireless, and our Wireless churn is the best we have seen in over two years. We have delivered positive Cable revenue and adjusted EBITDA growth, and we expect that our combined Internet and wireless loading will once again lead our peers. Media has once again delivered sector-leading growth driven by our added Warner Discovery media content and by our Toronto Blue Jays' very strong regular season performance. Additionally, this is the first quarter in which MLSE results are now fully consolidated with our Rogers Sports and Media business segment. We are pleased to report that Rogers is delivering solid results across all three core businesses against the backdrop of a competitive environment and slower growth economy. Starting with Wireless, we continue to deliver solid market share supported by disciplined financials. Wireless service revenue was flat and adjusted EBITDA was up 1% year-over-year, primarily reflecting the ongoing competitive intensity in the marketplace, continued lower immigration, and lower international roaming and wholesale revenue. Our sustained emphasis on driving cost efficiencies has moved our industry-leading Wireless margin to 67%, up 60 basis points from the prior year and near our all-time high of 68%. We have maintained strong market share for mobile phone net additions, adding 111,000 net new subscribers, consisting of 62,000 postpaid and 49,000 prepaid mobile customers. Across the entire sector, Wireless subscriber additions continued lower compared to the prior year, reflecting continued lower immigration levels. Against this lower growth backdrop, we have added a sector-leading 206,000 net new mobile phone customers year-to-date, with the majority of these subscribers opting for our feature-rich Rogers premium service plans. Our continued emphasis on responsive customer service and improved customer management has lowered customer churn to a very strong 0.99%, our best churn performance in over two years. Blended mobile phone ARPU of $56.70 is down 3% from the prior year, reflecting the ongoing impact from competitive intensity, combined with lower international and wholesale roaming revenue. Moving to Cable, Cable service revenue has once again grown 1% year-over-year, driven by retail Internet subscriber growth and continued discipline amid ongoing market competition. Cable adjusted EBITDA is up 2% year-over-year, driven by modest service revenue growth combined with our ongoing cost efficiency initiatives. As a result, Cable margins have reached an industry-leading 58%, an increase of 70 basis points over the prior year. Internet net additions of 29,000 customers reflect our continued success expanding subscribers throughout our national footprint and includes our continued success with 5G Home Internet, expanding our bundled service offerings into every region from coast to coast. Finally, Rogers Sports & Media revenue of $753 million was up by 26% over the prior year, reflecting the combined contributions of three key initiatives: our added Warner Discovery suite of media content, stronger results for Sportsnet and the Toronto Blue Jays, particularly through September to close out the regular season and the consolidation of MLSE effective July 1. Media EBITDA was $75 million compared to $136 million last year, reflecting both the positive contributions from Warner Discovery and the Blue Jays' regular season, offset by the seasonally low third-quarter EBITDA loss for MLSE, which is consolidated in 2025 but not in 2024. We expect MLSE will be substantially accretive to earnings in Q4 and for the second half of 2025. Additionally, the Blue Jays' successful MLB playoffs and World Series run will contribute further growth in the fourth quarter. Regarding unlocking additional value from our Sports & Media assets, we remain determined and committed to delevering our balance sheet and unlocking the significant unrecognized value in the RCI share price from these world-class sports assets. With the estimated value of more than $15 billion for our Sports & Media properties, we continue to work on identifying and executing the best long-term strategy to surface this value. The way our Toronto Blue Jays World Series run is captivating the country clearly demonstrates the power of our iconic sports teams. We anticipate a transaction could occur over the next 18 months, likely coinciding with or following our acquisition of the remaining 25% minority interest in MLSE. In the meantime, as we assess multiple options, our Sports & Media operations remain highly successful, operating at scale and delivering sector-leading and growing financial results and investment returns. In summary, our consolidated service revenue is up by 4% to $4.7 billion, and adjusted EBITDA is $2.5 billion, down 1%. The year-over-year changes in both service revenue and EBITDA reflect modest growth in Wireless, Cable, and Media combined with the consolidation of MLSE results starting this quarter. Capital expenditures were $964 million, relatively flat to last year, even as we absorbed some additional capital spending from consolidating MLSE. Free cash flow of $829 million was down 9%, driven by increasing taxable income and the timing of tax installment payments. We continued to delever in Q3 even as we acquired our additional stake in MLSE for $4.7 billion, leading to a roughly 0.5 turn increase in leverage at acquisition. Immediate execution on driving operating synergies and MLSE EBITDA growth, combined with ongoing free cash flow and capital initiatives to delever, allowed us to close the quarter with debt leverage of 3.9 times, down roughly 10 to 20 basis points in the first three months of the MLSE acquisition. However, our third-quarter leverage is up by 0.3 times due to the MLSE acquisition. We remain committed to strengthening our balance sheet further and improving our investment-grade credit ratings. We are in regular contact with credit rating agencies to communicate our plans and progress. This will be driven by continued prudent capital priorities alongside earnings and free cash flow growth to pay down debt and lower leverage. Unlocking value from our Sports & Media Holdings is a critical part of that strategy. At quarter-end, we maintained a very strong liquidity position with available liquidity of $6.4 billion, including $1.5 billion in cash and cash equivalents and $4.9 billion available under our credit facilities. As seen in our Q3 cash flow statement, we now report distributions paid by subsidiaries to noncontrolling interest, reflecting the distribution payment associated with the minority investment and a portion of our Wireless network infrastructure. The amount of $14 million reflects the prorated timing for the transaction, which closed in late June, and so the Q3 distribution is for a partial prior quarter. Going forward, we anticipate the full quarterly amount of the distribution to be approximately $100 million. A substantial portion of this is offset by the lower interest expense from using the transaction proceeds to pay down debt. Lastly, for affirmation and updates to our 2025 guidance, we have improved our outlook for both capital expenditures and free cash flow for the rest of the year, reflecting our ongoing efforts to drive efficient capital allocation and the current regulatory environment. We now expect to end 2025 with capital expenditures of approximately $3.7 billion, a further $100 million reduction from our previous target of $3.8 billion, and a full $300 million improvement from the anticipated high end of our guidance range announced in January, which was $3.8 billion to $4 billion. Notably, we are improving our targeted capital outlook while absorbing the additional expenditures associated with MLSE. Careful prioritization of our capital investments in 2025 will continue into 2026. We expect our 2025 free cash flow to be in the range of $3.2 billion to $3.3 billion, compared to the previously estimated range of $3.0 billion to $3.2 billion at the year's beginning. As we prepare for 2026 and beyond, we will continue to drive efficient capital investment, improve free cash flow, and strengthen and delever the balance sheet. In summary, our Q3 results demonstrate that Rogers continues to successfully execute on its core Wireless and Cable strategies. We have achieved consistent strong performance for almost four years and will continue to build on this track record in the quarters and years ahead. In Sports & Media, we continue to progress on our unique opportunity to surface significant unrecognized value from these assets for our shareholders. In the meantime, we pursue sector-leading growth and improved profitability for Rogers Sports & Media. I would like to extend a sincere thank you to our employees for their ongoing commitment, which drives our strong execution and future success. Thank you, and Go Jays. I will now ask Galyene to open the call for our Q&A session. Thank you.

Operator, Operator

First question is from Stephanie Price with CIBC.

Stephanie Price, Analyst

I was hoping you could talk a little bit more on the Wireless competitive environment as we head into the holiday season? And if you think the current pricing environment can be sustained here?

Anthony Staffieri, CEO

Thank you for the question, Stephanie. As we approached back-to-school, we aimed for a simple and redefined value proposition for our customers. We streamlined our pricing offerings and clarified the differences between our plans, emphasizing features beyond just data bucket sizes. This strategy has resonated well with our customers. We focused on the add-a-line concept to increase the number of lines per customer, which is also showing positive trends. Recently, we introduced tiered hardware promotional discounts, where the amount of discount on our hardware varies depending on the customer's plan, especially for current customers. This has been very appealing to customers, which is reflected in our subscriber performance, continuing throughout October. We believe we have the right value proposition as we approach Black Friday and the end of the year. We will monitor the marketplace's response and adjust our strategy if necessary, but currently, we feel confident about our pricing structures.

Stephanie Price, Analyst

And then maybe a follow-up on churn. Your churn has been down over the past two quarters. Great to see and hoping you can give us some thoughts on churn management and where there are further opportunities potentially.

Anthony Staffieri, CEO

What you're seeing is a very concerted effort. We've always focused on base management, but we've taken a much more holistic approach to base management and employing tactics that are resonating with customers in terms of what's important to them, drilling down on customers that we think might have a propensity to churn and dealing with the issues in advance of them calling us. And so there are a number of tactics that we've been going through, and the team is executing extremely well in base management. We expect to continue to see good churn performance across our entire base.

Operator, Operator

The next question is from Aravinda Galappatthige with Canaccord Genuity.

Aravinda Galappatthige, Analyst

I wanted to start off with Wireless. Obviously, the lag effect of the historical promotional activity continues to show in the service revenue numbers. But just looking at the sequential trend in service revenue growth, I wanted to sort of clarify whether that was sort of items around roaming or external customers that would have had an impact on that number?

Glenn Brandt, CFO

Thanks, Aravinda. Yes, the part of that decline really is lower roaming volumes as well as a reference to some wholesale revenues that, I'll shortcut and simply say, moved to another carrier. And so you're seeing that roll through. That's a very substantial part of what you've seen in the revenue.

Aravinda Galappatthige, Analyst

And just maybe just a bigger picture question on operating leverage. I mean with the progress that's made on the AI side of things, the latest generation being agentic AI and so forth. Can you talk about the magnitude of the opportunities that you have to potentially deploy those technologies within the firm and potentially drive streamlining efforts within Rogers, whether it's in customer experience or even on the network operations side, marketing, etc.? Just to get a sense of how material that could be from an operating leverage perspective to the company.

Anthony Staffieri, CEO

Thank you for the question, Aravinda. It's a great question and something we've been focusing on not only historically but as advancements in AI tools and technology continue to grow rapidly. We are exploring ways to leverage these advancements in three main areas. First is customer experience, where we aim to combine it with a fully digital approach, which will help us provide customers with a more consistent and streamlined experience to address their issues. We look forward to this and believe it will be more cost-effective. The second area is efficiency, as these AI tools enhance our operational effectiveness, which is already reflected in our leading margins in both Wireless and Cable. The third area concerns security, where we aim to continue improving protection for our customers and our own data. We're focused on all three categories and will keep deploying these efforts. The opportunities in this sector are significant, and we will continue to observe large global players and the successful tools they've implemented, ensuring we can follow their lead efficiently.

Operator, Operator

The next question is from Drew McReynolds with RBC.

Drew McReynolds, Analyst

Maybe extending the network revenue question, I think from Aravinda. Maybe, Glenn, can you talk about just, let's level set expectations about how that trends just given all the moving parts whether you want to talk about Q4 into 2026, just how are you thinking of the puts and takes and the trajectory? And then second question, obviously going to fit in a Jays one here. On the sports assets, I mean, clearly, incredible to see the whole country alive here. Maybe, Tony, you've talked about kind of how these three businesses have to stand on their own, but clearly, there's a branding and cross-promotional aspect to this all. Just wondering if we would see or have seen direct impacts on your telecom business in terms of subscriber growth or benefits that are coming your way on the telecom side that we'd see in either Q3 or Q4 or just maybe longer term?

Glenn Brandt, CFO

Thanks, Drew. Let me start with the first part of that. I'm not going to take the opportunity to start guiding for 2026. I will say the trends you see, I'll say, through the first three quarters of 2025 and the trajectory of hitting growth on the year for service revenue, we remain firmly committed to and expect. And so for the year, you'll see positive service revenue growth for Wireless. We all know the competitive framework that we operate in and the slower subscriber growth. That's why you see us leaning in on base management and churn improvement. That's a very efficient way of finding, if not revenue growth, certainly sustaining the base of operations. And so we remain committed to that. Q4, I expect, you'll see strong execution. Part of our Q3 backdrop as we are lapping a very strong Q3 in the prior year, and we have sustained and held the very fast part of that growth that you saw in '24 through the first three quarters of '25. So I'm pleased with that progress. So Q4 will be another strong quarter. I won't comment further on guiding for that or beyond in '26, but pleased with the progress for sustaining that base management through the 3 quarters.

Anthony Staffieri, CEO

Drew, with respect to your second question, as you pointed out, we're looking to each one of our pillars of growth being Wireless, Cable and now Sports & Entertainment to stand on their own and drive value, profitability and growth in their own respect. But we also look to ensure that we're capitalizing on the cross-synergies amongst all our assets. And the run of the Toronto Blue Jays and heading into the World Series, you can see that in spades in terms of the ability to enhance our brand, the ability to showcase our Cable and Wireless products and services to viewers of the game, and we've seen that throughout the year. If you think about some of the key events in 2025, Four Nations, the playoff run of the Toronto Maple Leafs, and then the Toronto Blue Jays and there are others as well. But you see the power of live sports, and it's good to see, and it's been a benefit for us, as I said, in and of itself, but also in terms of helping the broader Rogers.

Operator, Operator

The next question is from Vince Valentini with TD Cowen.

Vince Valentini, Analyst

I assume you're getting a lot of favors and requests for tickets for the World Series. I'm wondering if you can compare that. How many requests are you getting for this versus the Taylor Swift concerts? You don't have to answer that.

Anthony Staffieri, CEO

These are the most World Series requests we've had in 32 years.

Vince Valentini, Analyst

Thanks, Glenn, a very accurate answer as always. The more serious question. Look, you've been asked this several times. I want to hit this head-on. Given pricing is improving in Wireless, your front book is now above your back book. And we've seen the CPI stats show a material improvement in September to basically flat for Wireless pricing versus double-digit declines earlier in the year. All that should mean that Q3 is the trough quarter for Wireless ARPU at minus 3.2%. Can you not confirm that, that it won't get worse than that and should gradually get better over the next 5, 6 quarters?

Glenn Brandt, CFO

Succinctly, I agree with your sentiment. I think we are seeing some strong initiatives around a large number of initiatives to sustain the base, low churn and sustain revenue. And so broadly, yes, I think you are seeing us continue solid Wireless growth on a full year as well as quarter-to-quarter. You saw a dip in the third quarter, but all of the elements that you've pointed out are true, Vince.

Vince Valentini, Analyst

If I can just sneak in one more. Wireless equipment margin was a pretty positive contributor to EBITDA again this quarter. In the past, it hasn't always been a positive. Has something changed in terms of handset subsidies and the amounts you're giving out to or something changed with your deals with the vendors to allow that to be a sustainable source of positive EBITDA?

Anthony Staffieri, CEO

The main factor in the third quarter was our transition to the tiered promotional discounting that I mentioned. Although we introduced it later in the quarter, it coincided with increased sales due to back-to-school promotions. This strategy has proven to be very effective in lowering our net hardware costs while also encouraging customers to upgrade their tiers. As a result, we are quite pleased with the positive impact on our ARPU, which has shown a strong year-on-year increase. We believe this indicates the beginning of a favorable trend regarding our net hardware costs.

Operator, Operator

The next question is from Maher Yaghi with Scotiabank.

Maher Yaghi, Analyst

Glenn, I wanted to clarify something. In your previous response, you mentioned that you agreed with all the assumptions in the question. Can you confirm that the back book of your Wireless service customers is below the current front book?

Glenn Brandt, CFO

I'm answering from a general sentiment of whether or not we are troughing, whether or not Wireless service revenue is growing. I'm not getting into the detail of front or back book. You've heard me answer these questions consistently, Vince, or Maher, when we're asked on what's ARPU trajectory, I focus on service revenue growth and EBITDA growth. And on service revenue growth, I expect Wireless service revenue to grow each quarter and each year. We had a slight and it's a very slight decline just below zero or flat in the third quarter. For the year, we'll be positive, and I expect it will be positive going forward. It's a mix of subscriber additions, pricing initiatives, service plan initiatives, simplifying our service plan offerings and trying to move customers up through premium plans. I could go on and on. So I don't want to talk about front and back book because it makes it seem like there's a difference between new and long-standing customers. It's really working with our service plans and our initiatives all around that to drive service revenue and EBITDA growth. So don't read too much into that. I'm answering from a general sentiment; we expect Wireless service revenue to grow period.

Maher Yaghi, Analyst

Thank you for answering this question more accurately. I think there's still some room for improvement, but I agree there's potential for growth next year. I wanted to ask, although it's not very evident in your results, I'm not surprised since Canada tends to lag behind the U.S. when it comes to new product launches. However, the recent results from AT&T and T-Mobile indicate a noticeable increase in customers eager to get their hands on the new iPhones. Have you noticed any increase in customer interest in Canada during Q4? If not, could you explain why? Additionally, how are you preparing for Q4 in case we see a similar trend in Canada? Do you believe handset subsidization will play a more significant role in the overall economics of attracting customers in Q4 compared to previous quarters?

Anthony Staffieri, CEO

A couple of things that you touched on, and I'll work backwards from your question. In terms of Q4, the demand for new devices and the subsidy and cost for us, what you see in market for us is how we intend to approach the marketplace in the fourth quarter. We think we have a very good value proposition, and our promotional incentives are really going to be centered around hardware rather than rate plans. But we're also going to be very disciplined in the tiering constructs that I spoke about earlier, so that higher promotional discounts come with our more premium plans and vice versa. In terms of, to use your term, jump ball that we're seeing with the launch of the new iPhone device, we've seen good demand for it. Our bigger constraint has been supply, frankly, on that front. And so that's been a limiting factor for us, but I would say at the margin. But we're seeing the same type of industry constructs for our business that you described.

Operator, Operator

The next question is from Batya Levi with UBS.

Batya Levi, Analyst

Can you talk a little bit about the competitive environment in terms of, if you're seeing any pickup in go-to-market strategy with converged offers? And from your perspective, can you give us a sense of maybe what percent of your broadband base takes the Rogers services as for mobile? And what are some benefits you see beyond just churn reduction?

Anthony Staffieri, CEO

Thanks, Batya, for the question. Converged offering is something that we spoke about in previous calls and continues to be a competitive advantage for us, frankly, given our Wireline and Wireless converged footprint. And now with FWA, we're essentially converged on 100%. And so our go-to-market strategy has been to leverage our distribution channels, which are the strongest and frankly, the best in the industry here in Canada and leverage those to offer customers a converged home solution as well as their wireless products, and we're seeing good pickup in that. In terms of the percentage, we don't disclose that, but it continues to rise rather rapidly and customers looking for that solution. And there are a number of benefits beyond. The converged offer is a bundled discount, a modest discount for it, but there are other benefits the customer sees in terms of simplified servicing, having to deal with only one provider. And the convergence of the technologies, as that evolves, they see benefit in that.

Batya Levi, Analyst

Got it. And just a quick follow-up on the lower CapEx for this year. Can you just provide a bit more color on where it's coming from and also how we should think about capital intensity going forward?

Anthony Staffieri, CEO

We've been very focused on efficiency throughout our operations. You've seen it and continue to see it in our operating margins across our Cable and Wireless businesses. And you'll see it in our Media business as well going forward at scale. But we've also continued to focus on capital efficiency. And that's what you're seeing play out there. There are projects that we decided not to invest in as a result of government decision on TPIA. Certain projects were just not viable and carried too much uncertainty, and it's disappointing. We're a company that wants to invest in this country and in infrastructure. And when faced with uncertainty that those types of decisions create for us, we have no choice but to pull back on capital investment, and you see that impacting the total dollars. In terms of going forward, you should expect us to continue to look for improved efficiencies and ways of continuing to reduce our capital intensity across our businesses.

Operator, Operator

The next question is from Jerome Dubreuil with Desjardins.

Jerome Dubreuil, Analyst

The first one, I just wanted to hear maybe more about the financing plan for the Kilmer deal, which we understand is coming. Glenn, you mentioned that there's been credit agencies discussion. I'm sure they're aware but if you can comment on the plan maybe to bridge a gap just so the market is ready, and we don't have to start over with the balance sheet questions when the Kilmer deal comes.

Glenn Brandt, CFO

Our main focus is on acquiring the remaining 25% minority stake, integrating the operations, and then recapitalizing the combined Rogers Sports & Media, which includes MLSE and the Blue Jays. This could take place soon after we acquire the minority stake, or it might occur after some time. We are aiming for this to happen within the next 18 months, possibly in 2026 since we are in October now. The process of acquiring the 25% stake will take some time, and during this period, we will analyze how to best capitalize the combined entity. This will largely depend on our arrangements with the minority shareholder regarding their stake and the timing of that buyout. There is significant interest from potential institutional investors in these assets, which are very attractive. We are collaborating with credit rating agencies to keep them informed about our timeline. It's crucial for us to address the Shaw deleveraging by midyear before we move forward with the MLSE consolidation and recapitalization, which will allow us to reset our calendar and work out the necessary details. In conclusion, I won't provide specifics on who we're selling to or how much because I don't want to make any premature announcements. However, I am confident in the value of our combined assets, which exceed $20 billion, and we have seen significant interest in these assets. Our track record, including the Shaw acquisition, demonstrates our ability to manage debt effectively. We remain fully dedicated to this process and have a strong asset base to support our efforts, so I am highly confident in our execution.

Jerome Dubreuil, Analyst

Great, Glenn. To summarize, credit agencies are aware that we won't need any equity to bridge a gap, and it would be beneficial to have that information publicly available.

Glenn Brandt, CFO

Yes, succinctly, yes, they are aware we have time to execute. They know we are committed to executing on this. I have been managing our credit ratings and our capitalization and capital structure and funding as a primary part of my role for coming up on 34 years now, I've been working with these credit rating agencies throughout that 34-year period. They're well aware of our intentions and our capabilities.

Paul Carpino, Vice President of Investor Relations

Galyene, we have time for two more questions, please.

Operator, Operator

The next question is from Matthew Griffiths with Bank of America.

Matthew Griffiths, Analyst

Regarding Sports, historically, managing the control of assets after a transaction has been a key priority. Although this hasn't been discussed today, I wanted to know if it is still a priority, alongside maximizing shareholder returns from any potential deal in the next 18 months. Additionally, concerning Wireless, the release mentioned that the satellite service launch has contributed to increased costs. I'm curious if this is mainly a marketing issue or if it involves payments to the partner or a mix of both. I would appreciate some clarity on this, as I know we are still in the early stages.

Glenn Brandt, CFO

Thank you, Matt. Let me start with the Sports side of it. I'll answer it quickly with just a reference back to the asset value within our sports holdings is, as I've said, somewhere in the range of once we own 100% of everything, Blue Jays and RSM operations today plus MLSE. We've indicated we think the value of that is over $20 billion if we were to sell a majority stake, that would be raising north of $10 billion. I don't need $10 billion of equity improvement in the RCI balance sheet. And so I do expect we will maintain control simply because the exercise is not that large, and these assets are very valuable. We do anticipate we will control these assets.

Anthony Staffieri, CEO

And the second part of your question, Matt, in terms of our Wireless operating costs, you're referring to the comments made in the press release. Year-on-year, we've had a very modest increase in operating costs, and you see it in the disclosures of about $8 million. It's a combination of several factors. One of those factors that is described is the satellite to mobile initiative. And as you rightly point out, it does encompass both the marketing as well as the fee paid for the service under our contract. And we are currently in the beta trial mode. We've extended the beta trial mode to allow the commercial launch to be coincident with the launch of new feature capabilities of the satellite. Right now, it is just texting, but very soon, we're pleased to announce and see that it will include data as well. And so that's the reason for extending the beta trial before we get to commercial launch. And so you don't see any of the revenue pickup in our Q3 results, and you won't see it until we move to commercial launch.

Operator, Operator

The next question is from David McFadgen with Cormark Securities.

David McFadgen, Analyst

So maybe just following on the Rogers Satellite for a second. So right now, this texting, do you expect to add data, I guess that would be a light data plan? And then do you have any ideas when you'd be able to offer text, voice and just full data?

Anthony Staffieri, CEO

Thanks for the question, David. So on launch, again, to reiterate, it was texting, including 911 texting in terms of capability. We are extremely pleased with the advancement of the roadmap. Data wasn't going to come until next year, and voice was planned for the year after that. As a result of the work that our partner has been doing at a very rapid pace, we're pleased that this quarter, what we will have for our customers is the ability to use data and apps. As you describe, it will be somewhat light data. We'll see the capability in terms of bandwidth once it's into production. But we're really excited about that. And then the next to follow is voice. We don't have something we can disclose on that, but you should expect it at some point in 2026.

David McFadgen, Analyst

Okay. And then can you give us any idea on the number of people that have signed up for the trial so far?

Anthony Staffieri, CEO

It's received terrific demand from our customers and Canadians broadly in signing up for it. As you can imagine, just given our topography and landscape here in Canada, there are significant areas that weren't covered by any wireless network, including some major highways. And so the use case for it is significant. And what we're seeing is a very good pickup. So it's a material amount. What I can tell you, it's over $1 million, but we're not disclosing the specific number because we don't want to get too far ahead of ourselves in trying to extrapolate what kind of revenue that means.

Glenn Brandt, CFO

One of the real opportunities here for us, David, is that it covers the very remote regions of the country, it covers virtually every road and highway. And so there's the individual Canadians that are signing up, the enablement of this for businesses is tremendous and the opportunity for us is tremendous.

David McFadgen, Analyst

Well, the fact that you've had over 1 million sign-ups, that's pretty very good. And then just one, if I could squeeze in one more. Just on the Wireless side. So if we don't see any change in immigration, immigration stays at the current levels, do you think your Wireless net adds would be similar next year or higher or lower?

Glenn Brandt, CFO

Right. I think let me avoid guiding for next year. But I would say if I look at 2025, even with very, very low immigration our growth is in the range of 3% for the sector, for the industry and 3% growth is roughly 1 million adds for the industry. And so I would expect that to continue until immigration turns up again. It will at some point. I don't expect that in 2026; it would be wonderful if it did, but it will come back at some point. We will look to grow the population. Again, I expect that's a key part of economic growth for any country, but 3% growth in the base is certainly something we can still build on.

Paul Carpino, Vice President of Investor Relations

Thanks, everyone for joining us. If there's any follow-up, please feel free to reach out, and have a great day.

Glenn Brandt, CFO

Thank you all. Go Jays.

Operator, Operator

This brings to a close today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.