BCE (NYSE:BCE) CFO Curtis Millen said the company is prioritizing customer experience, fiber expansion and disciplined capital allocation as it pursues growth in wireless, U.S. fiber, managed technology services and AI infrastructure.
Speaking at an investor conference, Millen said lower customer churn reflects operational improvements rather than being the primary objective. BCE reported its lowest prepaid wireless churn in three years during the second quarter, and Millen said churn is a lagging measure of whether customers are satisfied with their service interactions.
AI Use Extends Across Customer Service and Operations
Millen said BCE is using artificial intelligence across finance, legal, human resources and customer-facing operations. In customer service, AI can help agents and automated systems quickly understand a customer’s services and provide clearer answers, he said.
He added that BCE’s churn performance has improved in five of the last six quarters across both wireless and wireline operations, which he attributed to broader improvements in service levels and customer experience.
On the Canadian wireless market, Millen characterized the current environment as “very constructive.” He said back-to-school pricing was higher year over year and that promotional intensity was lower than in the previous year, while customers continued to receive what he described as good value.
Millen said BCE does not intend to pursue subscriber additions that do not create long-term value or profitability. He said management is focused on free cash flow and net debt reduction, metrics that also influence executive compensation.
Fiber Growth in Canada and the U.S.
Millen said wireline service revenue has increased by “a couple of points” in recent quarters, supported by fiber. In markets where BCE has fiber, he said the company has been generating between 45,000 and 50,000 net additions and is selling wireless services to roughly 40% of new fiber customers.
“Fiber keeps winning in the market,” Millen said, arguing that the technology supports lower churn and higher long-term subscriber value.
In the U.S., BCE’s Ziply Fiber unit has paused some construction activity to refine its geographic priorities, according to Millen. He said the business has performed well in areas where its fiber network is already available, particularly in cable-only markets with demand for a fiber alternative.
Permits for the U.S. fiber build are up fourfold year over year, Millen said, though he noted that permitting, engineering approvals and construction require time. BCE sees Ziply as a long-term growth platform, with the company focused primarily on building and penetrating fiber networks rather than large-scale acquisitions.
The company may consider smaller acquisitions, which Millen referred to as “launch pads,” if they are within priority markets, are appropriately sized and unlock additional construction opportunities.
- BCE is targeting markets where cable operators have historically held substantial share.
- Millen said Ziply generally is not pursuing a strategy of competing directly with AT&T and Verizon in dense urban fiber markets.
- He said the company expects its markets to sit between urban areas likely to attract major telecom fiber builds and more rural locations where satellite services may be more relevant.
Media and AI-Powered Solutions
Millen said BCE expects its media segment to produce positive long-term revenue and adjusted EBITDA growth, although results can be affected by major events such as the Olympics and FIFA competitions. He said Crave has grown to more than 5 million subscribers and has expanded from a video-on-demand offering into a broader content platform that includes live events, podcasts and election debates.
Beyond data centers, Millen said Bell Cyber and Ateko, BCE’s cybersecurity and managed-services businesses, grew 29% in the second quarter. He said customers are seeking help implementing technology platforms, improving costs and securing their data and operations.
BCE has described its combined AI-powered solutions business as a potential CAD 2 billion revenue operation by 2028. Millen said demand for the company’s AI fabric data-center initiative has accelerated since BCE’s October investor day. The company initially included 73 megawatts of monetized power in its plan, later adding a signed 300-megawatt Saskatchewan project for a total of 373 megawatts.
Capital Allocation and Balance Sheet Goals
Millen said BCE is targeting returns of 20% on AI fabric investments and is pursuing projects with signed contracts, secured power access and defined revenue and EBITDA expectations before committing capital. He said the company remains committed to reaching a 3.5-times leverage target by the end of 2027 and reducing leverage further thereafter.
If demand exceeds BCE’s ability to self-fund projects, Millen said the company could consider partnerships or other infrastructure-financing structures similar to those used in the U.S. and Europe.
BCE has also announced CAD 6.6 billion of asset sales toward a previously stated goal of reallocating approximately CAD 7 billion of assets. Millen said the company would continue to assess sales, partnerships and acquisitions based on their potential to improve free cash flow, support growth and create shareholder value.
About BCE (NYSE:BCE)
BCE Inc is a Canadian communications and media company headquartered in Montreal, Quebec. Through its Bell operations, the company provides wireless and wireline telecommunications services, including mobile voice and data plans, high-speed internet, telephone services, and business communications solutions.
BCE also offers television services, including conventional, satellite, and internet-based television, as well as digital content and streaming products. Its media operations include television networks, specialty channels, digital media properties, and sports and news programming.
