TELUS (TSX:T) has long been a favourite for investors seeking stability. The latest results show why it continues to be viewed as a safe harbour in turbulent markets. Over the past year, the dividend stock has traded in a steady range, up slightly from last summer’s levels, while maintaining one of the most attractive yields among major Canadian telecoms at roughly 7.5%. For income-focused investors, that combination of a healthy payout and a resilient business model is tough to beat. So, let’s get into why this could be a top-notch choice for any portfolio.
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Into earnings
In the second quarter of 2025, TELUS delivered $5.1 billion in revenue, up 2% from a year earlier. Growth was driven by higher service revenues in its core technology and telecom operations, as well as its expanding TELUS Health segment. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 4%. This showed that cost controls and efficiency gains are helping offset the heavy capital spending that comes with building and maintaining world-class infrastructure. Free cash flow reached $535 million, up 11% year over year, giving the dividend stock more flexibility to reduce debt while still rewarding shareholders.
Customer growth remains a bright spot. TELUS added 198,000 new mobile and fixed customers in the quarter, with 167,000 coming from mobile phones and connected devices. Fixed line additions totalled 31,000, boosted by the ongoing expansion of its PureFibre network into Ontario and Quebec. Postpaid mobile phone churn stayed impressively low at 0.90%. This marked the 12th consecutive year below 1%, a testament to the company’s customer service and bundled offerings.
More to come
TELUS Health has become an increasingly important growth driver. The business posted operating revenue growth of 16% and adjusted EBITDA growth of 29%, expanding its global reach to 157 million lives covered. The dividend stock has realized $400 million in annualized synergies since acquiring LifeWorks, and it remains on track to hit $427 million by year-end. These results underline how TELUS is more than just a telecom. It’s building a diversified portfolio that spans digital health, security, and smart home services.
On the financial front, TELUS made progress in strengthening its balance sheet. It ended the quarter with a leverage ratio of 3.7 times net debt to EBITDA, down from the prior quarter, and expects to reach around 3.55 times by year-end. The recently announced $1.26 billion sale of a 49.9% stake in its newly formed wireless tower operator, Terrion, will help speed up debt reduction. The dividend stock targets a three times ratio by 2027, alongside phasing out its discounted dividend-reinvestment program.
Considerations
The dividend remains one of TELUS’s biggest draws. At a forward annual rate of $1.67 per share, it offers a yield well above its five-year average. However, the payout ratio is high at over 240%. Management’s confidence in maintaining the dividend comes from steady free cash flow growth and ongoing cost savings. Yet investors should keep an eye on execution in the years ahead to ensure those cash flows remain strong. For now, a $10,000 investment could bring in $743 at writing each year.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| T | $22.45 | 445 | $1.67 | $743.15 | Quarterly | $9,990.25 |
Looking forward, TELUS plans to keep capital expenditures at roughly $2.5 billion for the year, focusing on expanding PureFibre and enhancing 5G coverage. With telecom services firmly entrenched as essential spending, demand should remain stable even in a softer economy. The real opportunity lies in continued growth from TELUS Health and other value-added services. These could gradually improve margins and diversify revenue away from traditional telecom lines.
Bottom line
For investors searching for a combination of income and resilience, TELUS’s latest quarter reinforces its reputation as a defensive pick. It may not deliver explosive growth, but its steady cash generation, disciplined debt management, and diversified strategy give it staying power. In a market where stability is increasingly hard to find, TELUS continues to stand out as a reliable anchor in a balanced portfolio.
