Rogers Communications is under renewed scrutiny following a fiber cut in Richmond, British Columbia, that disrupted internet services for some customers in the Bridgeport and Golden Village areas. The outage, which began early Friday morning, has raised questions about network reliability just as the company reported a significant slowdown in subscriber growth.
The incident was first reported by Internet Lightspeed, which noted that users in the affected areas were experiencing connectivity issues due to a possible fiber break. Rogers confirmed that repair work is ongoing but has not yet disclosed the number of impacted customers or the potential cost of service credits. The timing of the outage, ahead of the Toronto market open, has kept investors on edge.
Rogers added 17,000 retail internet subscribers in the second quarter, a 34.6% decline from the 26,000 additions in the same period last year. This slowdown in subscriber momentum is a key concern for analysts, especially in a competitive telecom market. The Richmond outage, while localized, could exacerbate customer retention challenges if it leads to prolonged service disruptions or widespread customer dissatisfaction.
At the end of June, Rogers reported 4.521 million retail internet subscribers and 4.862 million cable customer relationships. While a single fiber cut in a specific neighborhood may have limited direct financial impact, the broader implications for network reliability and customer trust are significant. A larger or longer-lasting outage could trigger churn, service credits, and regulatory scrutiny.
Rogers' stock closed Thursday at C$50.14, down 0.61%, with the market yet to fully react to the latest outage news. In contrast, BCE (TSE:BCE) and Telus (TSE:T) saw minimal movement, while Quebecor (TSE:QBR.B) fell 3.47% for unrelated reasons. The relative stability of Rogers' share price suggests investors are treating the incident as an isolated event, but sustained underperformance could signal growing concerns about network reliability.
The cable segment, which includes internet services, reported robust financials in the second quarter. Revenue increased 1% to C$1.984 billion, adjusted EBITDA rose 1% to C$1.158 billion, and capital expenditures decreased 9% to C$367 million. However, average revenue per customer (ARPA) dipped slightly to C$135.49, and the company's overall free cash flow improved 6% to C$982 million.
Chief Executive Tony Staffieri highlighted "strong execution" across the company's three business segments, but the slowdown in internet subscriber growth and a miss on wireless postpaid net additions (22,000 vs. 26,726 expected) have tempered optimism. Rogers shares declined about 2% following the earnings release, according to Reuters.
Investors will be watching several key factors in the coming days: the duration of the Richmond outage, the number of affected customers, and any updates to Rogers' credit policy. The company has guided for service revenue growth of 3% to 5% by 2026 and free cash flow of C$4.1 billion to C$4.3 billion, but subscriber momentum remains a critical sensitivity. A shift of 1,000 customers represents 5.9% of Rogers' quarterly internet additions, underscoring the importance of resolving this outage quickly and transparently.
