BCE Inc. Aktie

Good morning, ladies and gentlemen. Welcome to the BCE Q2 2026 Results Conference Call. I would now like to turn the meeting over to Chris Summers. Please go ahead, Mr. Summers.

Thank you. Good morning, everyone, and thank you for joining our call. With me here today are Mirko Bibic, BCE's President and CEO; and our CFO, Curtis Miller. You can find all our Q2 disclosure documents on the Investor Relations page of the bce.ca website, which we posted earlier this morning. Before we begin, I'd like to draw your attention to our safe harbor statement on Slide 2, reminding you that today's slide presentation and remarks made during the call will include forward-looking information, and therefore, are subject to risks and uncertainties. Results could differ materially. We disclaim any obligation to update forward-looking statements, except as required by law. Please refer to our publicly filed documents for more details on assumptions and risks. With that out of the way, I'll turn the call over to Mirko.

Thank you, Chris, and good morning to all. Our Q2 results show continued execution against the strategy we laid out at Investor Day last year. Consolidated revenue increased 1.5%, adjusted EBITDA grew 1%, and we generated more than $1 billion of free cash flow in the quarter. We also reduced our net debt leverage ratio to approximately 3.7x while continuing to invest in the growth platforms that will shape BCE's long-term profile. The quarter also reflects progress across a number of key areas. Wireless trends improved with pricing better reflecting the value we offer customers, postpaid churn reaching its lowest quarterly level in 3 years and improved product margins. Fiber continued to drive Internet growth across Canada and the U.S. Bell AI Fabric continued to build momentum, and Bell Media delivered a strong quarter supported by FIFA World Cup performance and continued growth at Crave. This is exactly how we said we would run the company, disciplined execution in the core business, focused investment in higher growth opportunities and a clear path to sustainable free cash flow growth. In fact, we've led the industry for the past couple of years in bringing down Canadian telecom capital spending in the face of unfavorable regulatory decisions, while at the same time, redirecting that capital toward AI fabric and U.S. fiber. I'll start on Slide 3 with our progress against the 4 strategic priorities we outlined last year. Putting the customer first remains foundational. In Q2, the customer experience and retention initiatives we've executed over the past year and even before that continue to pay off. Postpaid churn improved 4 basis points year-over-year to 1.02%, which is the lowest quarterly level in 3 years. And in a lower growth market, that matters. We also launched our always-on Internet solutions, wireless Internet backup and power backup. These are practical solutions that help customers stay connected when Internet service is disrupted or the power goes out, and they reflect how Bell's network assets can work together to deliver a more resilient experience. That focus on reliability and performance is also being recognized externally. During the quarter, Bell received leading network recognition from OpenSignal, Rod & Schwarz and Ookla, including Canada's most reliable Internet, Canada's fastest 5G+ network and a suite of 10 Ookla Speed test awards. Now turning to our second priority. delivering the best fiber in wireless networks, you see that fiber continued to drive growth in the quarter. In Canada, we added more than 45,000 residential FTTH Internet subscribers. Including Ziply Fiber, total residential FTTH net adds were nearly 55,000, which contributed to 14.2% Internet revenue growth. Where we have fiber, we continue to win. That's been consistent. It's consistent in Canada and now in the U.S. as well. At Ziply, the focus remains on build execution, as we mentioned as early as the beginning of this year and reiterated in May of this year. Permit submissions accelerated significantly through Q2, increasing more than fourfold from April to June. Contractor capacity and fiber supply are in place to support the expected second half build ramp and penetration trends remain consistent with our investment case. In wireless, we delivered more than 41,000 postpaid mobile phone net adds, comprising significant loading on the main Bell brand, consumer share, which is in line with our peers, and we saw improved performance in the large enterprise segment. This reflects our focus on higher-value customers, lower handset discounting and a healthier recurring revenue mix across all customer segments. Video also remains an important part of the household strategy, of course. Video net adds improved by roughly 24,000 year-over-year, driven by strong uptake of streaming bundles and a successful transition to hardware-free TV. Again, these are things we said we were going to do at Investor Day last October. And if you combine that with fiber growth and adoption of Bell's own streaming and content services, you see support and continued momentum in product intensity on the full-service Bell brand. We also completed construction of our first sovereign direct-to-device satellite ground station in Quebec with additional ground stations underway as we build the infrastructure to extend wireless connectivity beyond the reach of traditional networks through our AST partnership. Turning to our next strategic priority, which is leading in enterprise with AI-powered solutions. This remains one of the clearest examples of how we are repositioning Bell for growth. We're bringing together cloud, cybersecurity, AI adoption, data sovereignty, connectivity and AI infrastructure for enterprise and government customers. This is where Bell's enterprise relationships, national networks and AI capabilities come together. In Q2, demand for Atecho and Bell Cyber remained strong with combined revenue up 29% year-over-year. Again, clear proof of underlying momentum in AI-powered solutions. At the same time, Bell AI Fabric continues to move from announcement to execution. Saskatchewan remains on track with construction progressing at the 300-megawatt facility and first phase operations expected in the first half of 2027. The facility in Winnipeg is on track to enter service in the second half of this year and Merit Phase 2, which is supported by the Cohere, Buzz HPC and Hypertech partnership across AI models, GPU infrastructure and Canadian-built hardware, that facility Phase 2 expected in early 2027 as well. Turning to the last of our 4 strategic priorities, which is building a digital media and content powerhouse. The digital strategy, which we've been executing in Bell Media for several years now, continued to show strong momentum in Q2. Crave surpassed 5 million subscribers, growing 23% year-over-year to 5.1 million, supported by 49% growth in direct-to-consumer streaming subs. That scale matters because it gives a strong owned and operated domestic platform for premium content, sports and streaming, anchored in Canadian storytelling and our commitment to cultural sovereignty. FIFA World Cup 2026 was a major highlight this quarter, of course. Our live coverage reached 30.5 million Canadians across TSN, RDS, CTV, Nuvo and Crave with millions more through FIFA programming across our platforms. The tournament Final in July became the most watched World Cup match ever in Canada with an average audience of 6.4 million viewers. Matches also consistently ranked among the most watched content on Crave. More broadly, premium content becomes more valuable as we monetize it across the full Bell Media ecosystem and increasingly through global content distribution. In Q2, digital video advertising revenue grew 39% year-over-year and total digital revenues were up 6%. That reinforces the monetization opportunity we continue to see from this strategy. Overall, Q2 reinforced the strategic role Bell Media plays inside BCE, premium content, growing streaming scale and stronger digital monetization, translating into 8.9% revenue growth and 3.8% adjusted EBITDA growth in the quarter. Now I'll move to Slide 5 because I want to come back to Bell AI Fabric and show the physical progress we're making on the ground. Saskatchewan is the anchor project. Since our Q1 call, piling has been completed and structural steel work is underway at our 300-megawatt facility. Key construction partners are in place, and the first phase remains on track for operations in the first half of 2027. We now have approximately 335 megawatts of contracted capacity, real facilities, real construction milestones, real customer commitments, all supporting the long-term AI-powered solutions growth platform we're building. Turning now to Slide 6. This is the scorecard we introduced at Investor Day to track whether the strategy is translating into deeper customer relationships, stronger monetization and sustainable growth. Q2 shows continued execution against that road map. We're focused on the operating drivers that support long-term revenue, EBITDA and free cash flow growth. And before I close, I want to thank the Bell team. The results we're sharing with everyone today reflect their focus on serving our customers, growing our business and executing against the transparent plan. Curtis will now take you through the financial and operating results in detail. So Curtis, over to you now.

Great. Thank you, Mirko. Good morning, everyone. I'll begin on Slide 8 with BCE's consolidated financial results. We're pleased with our results, which reflect continued execution against our plan, balancing measured investment with a clear focus on returns and free cash flow. Total revenue was up 1.5% year-over-year in Q2, driven by the contribution from Ziply Fiber and growth at Bell Media. Adjusted EBITDA increased 1%, driven by Ziply Fiber, with Bell Media also contributing positively. Adjusted EBITDA margin was essentially stable at 43.8% -- adjusted EPS was up $0.02 to $0.65, supported by higher adjusted EBITDA and the absence of certain noncash mark-to-market losses on FX hedges and options recorded in Q2 of last year. CapEx was up $317 million year-over-year, reflecting Ziply Fiber's fiber build-out in the U.S. and capital investments to support Bell AI Fabric. Putting aside the highly accretive AI fabric investments, our Canadian telco CapEx declined year-over-year, consistent with the disciplined multiyear reduction we've been executing. As shown on the slide, the majority of expected 2026 Saskatchewan AI data center CapEx of approximately $1.3 billion is to be incurred in the second half of the year. Consistent with the structure we outlined in March, we received our first tenant payment on the Saskatchewan facility in the quarter, part of the approximately $400 million in setup fees and prepayments that partially offset the build cost of the facility. Free cash flow was over $1 billion in the quarter. While down year-over-year due to higher CapEx, this was a strong result and is tracking consistent with our full year '26 guidance. Overall, in Q2, we delivered revenue and adjusted EBITDA growth, generated strong free cash flow and continue to fund targeted growth investments in Ziply fiber and Bell AI Fabric. Turning to Bell CCS Canada on Slide 9. Starting with a high-level summary of Q2 submetrics. We delivered 41,594 postpaid mobile phone net adds in the quarter. This was modestly lower year-over-year, reflecting less active market and reduced promotional intensity compared to Q1. Postpaid churn improved 4 basis points year-over-year to 1.02%, the lowest quarterly level since Q2 of 2023. The improvement reflected lower customer switching activity in the quarter, together with the continued benefit of our customer service and retention initiatives. ARPU was relatively stable year-over-year, down approximately 0.2% without the impact of G7 Summit-related revenue in Q2 of last year. Importantly, the monthly recurring charges component of ARPU increased 0.7% supported by higher quality loading and a healthier recurring revenue mix with improved transaction rates quarter-over-quarter and year-over-year. In broadband, residential FTTH Internet net adds were 45,271, a strong result. Demand for fiber remains strong and fiber continues to be the anchor of our household strategy. Video also continues to improve with 8,741 net adds compared to a net loss of 15,851 in Q2 of last year. The improvement was supported by strong uptake of streaming bundles and a successful transition to hardware-free TV, reinforcing the product intensity strategy we outlined at our Investor Day. Turning to the financial results for Bell CTS Canada. In Bell Business Markets, underlying revenue grew approximately 3.4% year-over-year, supported by continued momentum in AI-powered solutions, including Atteko and Bell Cyber. On a reported basis, EBM was lower, reflecting 2 nonrecurring items in Q2 of last year. Revenue from the Mission Flat AI data center in Kamloops, BC, which was recognized upon delivery under finance lease accounting as well as G7 Summit-related revenue. Wireless service revenue also affected by the G7 Summit in Q2 of last year. Without that impact, wireless service revenue was stable year-over-year. Wireless product revenue was down 6.6% year-over-year, reflecting our focus on healthier product margins, which drove fewer contracted mobile phone sales. Lower product revenue also reflected a Q2 market shift towards BYOD activations and fewer device upgrades. We'll continue to maintain discipline on hardware discounting given our focus on product margin improvement, ARPU growth and service revenue growth. To address affordability, we'll leverage device residual programs and trade-in rather than hardware discounting. Our adjusted EBITDA result was in line with plan. Notably, margin improved 40 basis points over last year to 46.1%. This reflects our continued focus on cost management with operating costs down 4.7% this quarter. Turning to Bell CTS U.S. on Slide 10. Ziply remains focused on build execution and fiber penetration. Build activity is expected to increase significantly in the second half of the year. Local permit submissions accelerated through Q2 and the broader readiness work is progressing across state approvals, engineering, contractor capacity and fiber supply. For expansion markets, state-level approvals have been obtained for approximately 75% of the 2027 location funnel and high-level engineering is complete for approximately 60% of those locations. On subscriber performance, Ziply delivered its highest quarterly residential net adds since BC acquired the business at 9,600, where Ziply has fiber penetration continues to track the business case. Revenue was broadly stable sequentially as fiber growth in consumer and small business was offset by ongoing legacy copper and voice declines and wholesale pressure. Adjusted EBITDA was $95 million, representing a 40.6% margin. The margin reflected higher subscriber acquisition activity associated with stronger Internet net adds. We're comfortable making that investment given penetration trends. Key point is that the fiber thesis remains intact, where Ziply has fiber, it is winning customers and the work needed to support the second half build ramp has advanced. Over to Bell Media on Slide 11. Continued digital momentum and strong overall financial performance marked the quarter. Total revenue up 8.9% and adjusted EBITDA up 3.8% year-over-year. Revenue growth was driven by strong FIFA World Cup performance and continued Crave growth with additional contribution from the Formula One Canadian Grand Prix and higher program sales. Advertising revenue increased 5.3%, supported by strong FIFA advertiser demand. Subscriber revenue was also up. It was up 6.7%, driven by continued D2C streaming growth. Crave subscribers grew 23% year-over-year to reach 5.1 million subscribers with direct-to-consumer streaming subs up 49%. Digital video advertising revenue also grew 39%, reinforcing the progress Bell Media is making in streaming scale and digital monetization. Adjusted EBITDA growth reflected the flow-through of higher revenue despite higher content and event-related costs associated with FIFA, Formula One Canadian Grand Prix and other premium programming. In short, a strong quarter for Bell Media. Turning to the balance sheet on Slide 12. We ended Q2 with $4.6 billion of total available liquidity, providing significant financial flexibility to fund our capital allocation priorities. Our reported net debt leverage ratio improved to approximately 3.7x at quarter end, down about 0.1x since Q4. As part of our ongoing focus on balance sheet optimization, we completed public debt offerings totaling $2.5 billion in June and repurchased debt securities trading below par value through tender offers. Together with growth in adjusted EBITDA, these actions contributed to the improvement in net debt leverage. Our defined benefit pension plans remain in a very strong position, solvency surplus of approximately $4.9 billion and an aggregate solvency ratio of approximately 125%. Looking ahead, the pending disposition of our land mobile radio network service business is expected to provide additional support for deleveraging. We remain on track to achieve our target net debt leverage ratio of 3.5x by the end of 2027. Turning to Slide 13. We are reconfirming all of our 2026 financial guidance targets. We remain focused on executing the plan we laid out at Investor Day, delivering revenue and EBITDA growth focused execution across our core telecom business, funding our key growth priorities in Bell AI Fabric and U.S. fiber, generating meaningful free cash flow and progressing towards our 3.5x leverage target by the end of 2027. With that, I'll turn the call back over to Chris and the operator to begin Q&A.

Thank you, Curtis. With that, operator, we are ready to take our first question.

[Operator Instructions] The first question is from Meyer Yagi from...

Curtis, I wanted to ask you in terms of the spend on Saskatchewan, you mentioned that to expect a ramp in the second half. Just wanted to ask you, on the last call, you mentioned that the ramp is going to be Q2, Q3 mostly. Now it's Q3, Q4. Can you maybe just help us understand why CapEx has been pushed out a little bit further down the year? Is that timing on payments or timing on construction changes?

Yes, thanks for the question. No change to construction time line. This is a recording of CapEx when we actually spend the money. So we've ordered the vast majority of the equipment. I mean the construction is pay as you go, but the vast majority of equipment has been ordered, but the CapEx will be recorded when the cash is actually being spent. And that's less in Q2, more in Q3, Q4. So again, no change in timing. Just about all the materials, all the equipment has been ordered with delivery schedules that are on time with our overall project, penalties for late delivery and in line with our budget.

Okay. That's great to hear. So just turning to Ziply now. my follow-up question is on the ramp in the second half. Now obviously, it looks like we should expect fiber deployment to ramp in the second half and going into next year. You have been adding quite a few subscribers since you started disclosing results. I'm looking at 5% subscriber growth in fiber since Q4, but the revenue line is essentially flat. So the whole concept of Ziply is to provide you with revenue growth and EBITDA growth over time. But I want to focus just on the revenue growth angle here. So do you expect the ramp in the second half to contribute to reaccelerating the revenue run rate of Ziply? And when should we expect that growth to be visible? Because over the last 3 quarters, top line is essentially flat. So you got legacy decline offset by broadband growth. So I'm trying to focus on the top line, please.

Yes. Hamir, thanks again for that question. So ultimately, at Ziply, look, we're quite happy with the progress. The build is ramping up, as you mentioned, it's permits, it's hard hats, it's actually doing the building, and that continues to ramp up as you've seen in our CapEx spend. And as you said, that will continue to ramp up back half of the year and then through into next year also. It's a continued ramp-up. So what the team at Ziply fiber has been really good at is where there is fiber, they are driving subscribers. So penetration rates on new fiber exactly in line with historicals and with plans. So again, where they have fiber, they drive subs, subs drive revenue. So the goal and frankly, the biggest driver of long-term value for our shareholders is continuing to drive that build and continuing to load fiber net adds. And in that part, quite successful. I'd say gross adds on fiber were up 25% quarter-over-quarter. So obviously, you have to spend the COA and it's a small base, but I'll take that temporary margin pressure for future revenue growth. I think that's a very good trade. And then yes, as you said, it's a small base. So if there's a -- this quarter, there was a heavier wholesale contract renewal than normal, and it has an impact on overall growth rates because it's still such a small base of revenue and EBITDA. But again, for us, what we're really focused on is build the footprint, drive fiber penetration and the financials flow from there. So again, we're seeing ramp up. And as we've kind of disclosed repeatedly, this continues to ramp up back half of the year.

The next question is from Drew McReynolds from RBC Capital Markets.

On the wireless side, a pretty good set of results considering a low volume environment, at least from my perspective. Just wondering if there's any unusual kind of dynamics in the quarter just given all the sporting events. I'm assuming no. So the question really is, can you provide an update on just how the bundling strategy is working, the premium brand strategy is working? And what should we expect for wireless ARPU network in the back half? And then second question to the data center side in the deck, you alluded to line of sight on 800 megawatts. Obviously, we've known that for a while. Just wondering if there's any update on that road map as we go from roughly 400 megawatts up to the 800...

So on the second one, still really, really kind of positive momentum across all the AI-powered Solutions businesses. But on AI fabric specifically, same goes. Funnel is very strong. So when we've got more to announce, we'll obviously do that, but well on track and remain quite confident in the ability to monetize in a reasonable period of time well more than the 335 megawatts that you already know about. On wireless, kind of wireless writ large, I say we're feeling that there's good industry momentum. And within that, we feel quite good about how we're executing certainly in accordance with plan. So I'd say you've seen in the back half of Q2, strong quarter-over-quarter pricing improvements and strong year-over-year pricing improvements, which have continued into July for sure. And again, as I said in my opening remarks, that's a good thing because it's far more -- the pricing we're seeing now is more reflective of the significant value and the significant investments that the entire industry, frankly, is delivering to consumers. So that's one thing. Within that, we are going to remain uber focused on profitability. And so what are the key drivers there that we need to look at? ARPU. In our case, very stable ARPU if you normalize for the impact of the G7 Summit last year, for sure. Same thing with wireless service revenues. On product revenue, you're seeing kind of good numbers there in the sense that you can see it's pretty obvious that we're focusing -- we're being very disciplined on hardware discounting. And that's what, frankly, the industry has to get back to ARPU and service revenue growth and has -- and that's what's going to allow us to continue to invest in the networks and in experiences that are going to drive value for consumers and of course, correspondingly and importantly, for our shareholders. So that's what we're going to remain focused on, Drew, and that goes with product margin improvements. So an example on hardware discounting rather than leaning into hardware discounting to address affordability of devices for consumers, what we'll be doing is using trade-in programs and device residual programs, and that's how we're going to address kind of the pro consumer agenda and enhancements, all while remaining focused on profitability. So I hope that answers the question. The underlying numbers there are pretty strong. What you see in terms of the net adds, good consumer numbers in line with kind of industry trends, and we've had strong performance in Q2 in the enterprise segment. And I think you referred to kind of the onetime impacts of sporting events. I thought you might have said that. The numbers that you see aren't reflective of anything unusual as a result of sporting events.

Our next question is from Stephanie Price from CIBC World Markets.

It's Sam Schmidt on for Stephanie Price. I wanted to follow up on the data center opportunity. A number of U.S. data center peers announced significant increases in CapEx this earnings cycle given demand tailwinds. Can you talk a bit about Bell's pipeline here and your appetite to spend more heavily on CapEx if the demand for the data centers is there?

Yes. So -- thanks for the question. Our focus remains on, first of all, executing against the build for the data centers we've already announced and the primary one there is Saskatchewan. And as Curtis mentioned, we're on plan there across all metrics, including CapEx spend. And more broadly in terms of strategically, we are deploying capital as a company where we have structural advantages. And in the case of data centers, it's power, network infrastructure, enterprise relationships, artificial intelligence, and that's how we're going to drive greater shareholder value over the short, medium and long term. And again, no surprises. We do exactly as we say. We've been very, very transparent that we have line of sight to 800 megawatts of power, 335 megawatts already contracted. And as we contract more, we'll -- as we get from the 335 to the 800 megawatts, we'll be funding it. And on that front, again, it's been very, very consistent messaging, and we'll continue to do as we say.

And then just one follow-up on the wireline environment in Quebec. What are you seeing in terms of competition from traditional competitors and new entrants? And how are you thinking about potential growth drivers there?

Thank you. We're much like it's a little bit -- my answer on wireless is kind of similar to the answer I gave to Drew on wireless. So my answer on wireline is similar to the answer I gave to Drew on wireless. We're seeing kind of pricing across the board, Quebec or otherwise, that's more reflective of the tremendous value we're providing to consumers. And then, of course, within that, as ourselves, we are quite satisfied and happy right now with how we're executing. And the multiproduct focus on the premium Bell brand is working. And for us, it's working is we do have the superior broadband network in fiber. So that certainly helps. We've made some tremendous improvements in our video offering with hardware-free TV and the streaming apps and the bundling, which is very attractive to consumers based on the take-up rates that we're seeing. You're seeing kind of lower churn as a result, and our product intensity stats are continuing to improve as we signaled they would when we held our Investor Day. So the key touch points are headed in the right direction. And I'll end my wireline answer exactly how I kind of focus my wireless answer, which is our focus as a company is improving the profitability of the connections we get to the wireline business.

Our next question is from Vince Valentini from TD Securities.

I'll focus on wireless. So a couple of questions about the outlook trends. I appreciate your comments on price discipline. But if you put together everything you're seeing in the market of the bad pricing, if I call it that, in Q1, the better pricing in Q2 and then the activation fees to the extent that will have some impact in Q3. Do you think wireless ARPU is still trending towards flattish? And do you have any prediction as to roughly when that happens? And do you think Q3 could get a bit worse with the activation fees falling off? Or have you found a way to to offset that? Secondly, on wireless, there's some chatter about a reasonably large government contract that may have shifted this quarter. I wonder if you can try to clarify that. I mean, is that a material portion of your postpaid adds this quarter?

Yes. On the second one, it's -- that's what I was alluding to, Vince, when I gave the earlier answer to Drew's question. So if you unpack our wireless net adds in there is a reflection of an enterprise contract won. But even parsing that out, our net adds otherwise are very, very much in line with our peers. And in fact, if those were the only numbers we can be reporting, we'd be quite satisfied. So in line with our peers on wireless postpaid net adds, even excluding the government enterprise contract that you referred to. In terms of ARPU and service revenue and kind of predictions, I certainly appreciate the spirit of the question. And I think rather than start predicting when things -- exact point in time when we're going to see this type of growth or that type of growth, I'd rather just focus on continued stability rather than getting into prediction game on timing. The competitive environment seems to have normalized certainly for a number of weeks now. We expect that improving trend to resume, certainly as we remain focused on profitability, where the fundamentals are looking solid right now. And that's the case in the back half of -- that was the case in the back half of Q2 and certainly in the beginnings of Q3. So let's focus on the key drivers that will allow that to continue to improve rather than making predictions because if we do that, it will obviously show up in the reported results, I presume, across the industry, and that's a decidedly good thing.

Can I just clarify also, Curtis, how much of the $400 million of tenant prepayments was received in the second quarter? And I assume that's flowing through working capital.

Yes. Vince, call it in and around 1/4 of that $400 million, just below $100 million, and that is showing up in free cash flow.

Free cash flow, is it in the working capital line or the CapEx line?

Yes. Working capital.

Our next question is from Tim Casey from BMO Capital Markets.

Could you just flesh out a little bit more this concept of the line of sight to 800 megawatts. No new announcements, but where do you -- where should we expect that to show up in terms of both timing and geography? I mean it sounds like you -- as you said, your funnel is very attractive. But could you just give us a little more color on that environment and how those discussions are proceeding with potential partners?

So in the -- so 335 contracted already. The long -- well, the Investor Day horizon plan, the plan to 2028 assumes 373 megawatts will be contracted. So that would be -- that means that today, we're at 90% contracted for the plan. To the extent that we can pull more in, we will, but you have to reflect in that the fact that if we, let's say, enter into a new contract for additional megawatts in late 2027, early 2028 the ability to generate meaningful revenues within -- in year 2028 would be very difficult to do because there is a build time line. So for now, let's just stick to -- we've got 373 megawatts in the medium-term plan, 335 already contracted and being built. And to the extent we can pull more in, we'll certainly try to do that. And geographically, it's kind of -- as we said, maybe the best way to answer that question, Tim, is to go back to May 2025 when we launched AI Fabric. And we said then that our vision and our plan was to build a national ecosystem of interconnected AI data centers. And that means that we have a vision where we would have data centers across multiple jurisdictions in the country. Of course, we've already got Manitoba, BC, Saskatchewan, and there'll be more to come in other provinces.

Our next question is from Jerome Dubre from Desjardins Securities.

First one I have is, can you share your views about whether long-term foreign satellite operators have a shot at competing with -- can wireless operators? If you can describe why it may or may not be possible in your view?

Thank you, Jerome. I'll give you maybe a short-ish answer on this. We view satellite as being complementary to our networks, and that's a structural conclusion. I'm giving you an answer that's grounded in physics. So in the markets that generate the vast majority of our revenue, as you know, and that's kind of where we have fiber and dense wireless, those networks are in a completely different league on capacity, on speed, on economics. And satellite doesn't change that and more satellites in the sky won't change that. And like fiber has 4x download advantage over satellite, 13x upload advantage over satellite, 5x better latency, and that's in rural, that's in urban. So where we have those networks, we have the distinct advantage. So that's the first part. Secondly, I'd say Canada is structurally different than some other countries. We have different spectrum availability and our allocation policies are different. here than in other jurisdictions. And the third thing I'd say is we're quite pleased and continue to be focused on our AST partnership, which we'll use to extend coverage where terrestrial networks, whether those are fiber networks or terrestrial wireless networks don't provide the coverage that consumers need.

That's great. Second one is on Ziply. Maybe on the margins, wondering if there were some near-term headwinds in the quarter on margins? Or is there an impact from the high competition we're seeing in the U.S.

Yes, thanks for the question. In terms of the second part of your question, in terms of pricing, no, we're not really seeing either an impact -- sorry, you're kind of asking what cable pricing in market and competitive intensity -- and it's not changing our ability to drive penetration, load subs on fiber. Those penetration rates are -- have been pretty consistent. And it's not changing our ARPU relative to our base either. So stable ARPU and stable ramps in penetration. Then in terms of the margin, it's what I talked about earlier, Jerome, right? So it's loading -- when gross adds are up 25% on a small base, the COA expense increase has an impact on margins and the flow-through on wholesale rerate.

Our next question is from Sebastiano Petti from JPMorgan.

Just sticking with Ziply there for a second. So the build activity is expected to increase in the second half here. You talked about permit submissions accelerating through the quarter. But maybe just back up and help us think -- I mean, what has been the constraining factor in the build to date? Is it the submission of the permits? Is it pushing the permits through the approval process? Because just trying to draw a conclusion from the acceleration of permits. Does that mean that approvals will also, therefore, accelerate? So just what's the constraining factor there? And then just back to the Bell AI fabric for a moment. Any update on, I guess, the sovereign workloads and like what you're hearing there, particularly as it pertains to Saskatchewan, right, implied upside to some of the financials you've laid out. And then in regards to the Merit Phase 2, should we anticipate as that comes online, there will be another finance lease onetime payment?

No, Merit Phase 2 will be an operating lease and therefore, not a onetime finance lease impact. On sovereign workloads, I think sovereign workloads are probably a kind of midterm upside to our plan, given kind of the long lead times on some of that demand. But in the meantime, frankly, we're just focused on monetizing the megawatts and the capacity we have available. So the sovereign upside and the timing as to when that comes isn't an impediment at all to executing against the plan that we've been transparently sharing with you. And as far as Zip is concerned, I think the main point here that that I want to reiterate again is back in February of this year, when we reported Q4 2025, we kind of transparently laid out that 2026 was going to be a build reset. We reiterated that again in May. So very, very transparent, no surprises. Now we're sharing with you that there's momentum building on the kind of the build plan. And I think the key thing here, Sebastiano, is what's fundamentally different. There are 2 things, but one of them that's fundamentally different is we're now in the growth phase, a different growth phase for Ziply, where we're starting to build out of incumbent territory. So that requires different sets of planning, and we're well on our way on that. So we're talking about permit submissions being up 4x from April to June. Our state-level approvals have been obtained. -- for 75% of the 2027 location funnel because you also need state approvals, then you need the more local permit approvals. We've got high-level engineering complete for 60% of the kind of '26 and 2027 funnel. We've got the contractors secured and the fiber supply secured for that funnel that we're getting approvals to build. So that's all work that takes time. And the gating item there was we're out of territory. And I shared on the previous call kind of how we adjusted the method of building even in territory. We're taking a more portfolio approach to the build even in territory, which is the way BCE has been doing it in Canada in order to more efficiently build at scale. So we readjusted with the Ziply build team even in territory, the approach we're going to take to build. So it was kind of take a step to the side in order to speed up. Again, no surprises here. I'm really quite pleased with the momentum that we're starting to build. And for me, the focus is less on what happened in Q2, and it's more is the funnel looking positive here so that we can start ramping at the back half of this year, gain even more momentum in 2027 and get to the $3 million in 2028. And I'm feeling positive about that part of it.

Our next question is from Aravinda Galapatigi from Canaccord...

I wanted to come back to sort of the balance sheet a little bit. Obviously, you're waiting for you to close on the Land Mobile Networks transaction. Marko and Curtis, maybe is there anything else that's out there in your portfolio that has sort of emerged? I mean how should we think about sort of the prospects for additional divestitures? And then a quick follow-up on sort of the Canadian -- the Bell CTS numbers. With respect to the onetime items, the Mission Flats finance lease and the G7 item, how did that impact the EBITDA, which was down, I think, 3.1%? Trying to get a sense of what would have been a more normalized number for that decline.

So I'll let Curtis answer the second one. I'll answer the first one. I think the most -- the best answer is to give you a short one on the first one. 1.5 years ago, we outlined that we plan to generate $7 billion in proceeds from dispositions, noncore asset dispositions. We're at $6.6 billion, so well on track. And the second part of the answer is we're going to -- we're focused -- hyperfocused on the 3.5x leverage ratio by the end of 2027, and we're going to hit that. And so it's probably the most effective way to answer your question, Aravinda. Over to you, Kurt.

Yes. And clearly, just to pile on in my role, like the 3.5 leverage target is obviously something we're going to hit. So we'll make our way there. And then in terms of Mission Flats, obviously, a year ago, there was onetime revenue was about $100 million, pretty good flow-through and G7 was -- we didn't give specific numbers, but in the mid-$30 million of revenue. So quite a big impact sequentially.

Our next question is from Matthew Griffiths from Bank of America.

Two, just on timing. With the Saskatchewan data center, first half one of the next year, one of the first phases we will get, I guess, start generating revenue. Sorry, what is the -- what pace should we expect for the following phases? Is it like a month between phases? Or is it more like a quarter that we should expect the subsequent phases to start being delivered? And again, sort of on timing, I'm really looking for when the PSP partnership, the NetworkCo kind of partnership in the states might start to play more of a role with a view to when CapEx -- consolidated CapEx for Bell could potentially start to trend lower. What is the -- can you share any timing on when their participation in the build could ramp up and your in footprint participation in the build kind of starts to ramp down? That would be just helpful.

Yes. Matthew, thanks for the question. It's Curtis. So on the second question in and around Network FiberCo, so you're right. I mean the funding doubled in Q2 versus Q1, but it's still $19 million, $20 million of NFC. So what you're seeing happening is exactly right, we're we're spending and we're reporting CapEx at the Ziply level, which will ultimately be transferred into Network FiberCo and will reduce our go-forward equity contributions. Again, the -- whoever has the permits and approvals has to do the building, and we didn't want to slow down our access to the fiber footprint to drive our value for shareholders. So Ziply is doing more of the building, as you pointed out, that we would be doing -- that we will be doing going forward. So it's really just a steady ramp of time where more and more of the footprint being built was actually secured on permits and approvals by NFC. So just kind of naturally over time, more of that will be on NFC paper.

On the first -- on the first question around the Saskatchewan data center build, I'd rather not get into specific kind of months. I'd say there's 4 data halls that we're going to be building, 2 data halls each -- we have 2 tenants, 2 data halls for each tenant, and we'll sequentially be making those data halls available to our tenants. So you don't think of months apart. Maybe it's more kind of gapped by quarters. But by the end of 2027, we'll be at full run rate on the revenue generation across the 4 halls.

The next question is from Batya Levi from UBS Financial.

A follow-up on Ziply. Could you put maybe some numbers around the fiber build where you expect to end the year? And how many homes do you expect to build next year? And the revenue growth question, you mentioned that pricing has been pretty firm. There's a wholesale step down. All in, do you still expect U.S. Ziply revenues to grow double digits?

Batya, it's Curtis. So in terms of LPs, we're still on track to hit 3 million by the end of 2028. So we won't get into kind of quarterly or end of this year type LPs. Obviously, we'll disclose that going forward, but I don't want to speculate here and give away too much strategic information in terms of our build plan. And then in terms of revenue, yes, look, it all flows from building fiber, which is why we are kind of consistently focused on the fiber build plan because, again, the team has demonstrated they can drive subscriber acquisition once they have fiber. So again, we're a bit of a broken record here, but building out the network is the most important thing for us to focus on, and we're getting momentum, but we want to continue to see more and more of it.

Got it. And I guess in the U.S., we're also seeing more go-to-market strategy with converged bundles. Has your view changed in terms of potentially adding an MVNO to drive an inflect growth? Or are you happy with the penetration targets you're seeing?

Yes, on that, well, thank you. We -- it's the same kind of approach that we're going to take when we see that penetration gains are flatlining and perhaps a broader offering is needed to get to the next step-up in penetration, we'll take a look at it. But as Curtis has shared this morning, our penetration where we have fiber continues to be exactly in line with historical and with the business case when we entered into this. So it's looking good. And we increased gross adds by 25%, which is the number that Curtis shared. So you can see that there's no slowdown in terms of sales in the areas where we have fiber. So that's a very good thing.

There are no further questions registered at this time. I would now like to turn the meeting over to Chris Summers.

Thank you again for your participation on the call this morning. Richard and I will be available throughout the day for follow-up questions or clarifications. So again, thank you, and have a great day. Thanks, everyone.

Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.

Good morning, everyone. I'm Sebastiano Petti, and I cover the Telecom, Cable, and Satellite Space for JPMorgan. I want to welcome BCE CFO, Curtis Millen. Curtis, thanks for being with us today.

Thanks for having me. Good morning, everyone.

Great. So just to kick us off, BCE has undergone significant transformation over the past year. You reset the dividend, you've acquired Ziply, launched Bell AI Fabric, which has a lot of momentum and sure to touch on. You also laid out a clear 3-year framework at the Investor Day. So now that you're 1 quarter into that plan and the growth vectors are becoming more visible, how should you frame, I guess, the strategic opportunity from here for investors who still may think of BCE as a traditional Cable and Telecom? And I guess, where is the management team spending most of their time?

Yes. Ultimately, we're executing the plan that we laid out at our Investor Day in October. So as you say, we're 3 months into a 36-month plan. And yes, you raised the AI Fabric. And ultimately, AI Fabric might be a faster time line than we expected. We're about 40% of the way there. At Investor Day, we talked about 73 megawatts. We've monetized 300 megawatts on the side, plus 28.7 megawatts out of the 73 megawatts. So that opportunity seems to be coming faster than certainly we baked in, in October at our Investor Day, again, being fairly conservative in what we wanted to bake into the model, knowing that we're having conversations in terms of securing power where we secured up to 800 megawatts.

Obviously, we're trying to secure even more than that. But that market, that industry is moving pretty quickly. But ultimately, we're executing the plan as we can rip costs and spend away from legacy product, legacy network, legacy processes, and pivot into more and more kind of next-gen products and services, whether it's digital media, whether it's AI Fabric, whether it's fiber investments, I mean, that's the plan. And again, we're allocating capital to where the best value is and the best returns are.

All right. Well, yes, so sticking with Bell AI Fabric and just Bell business for a minute. So I just want to touch on the comments around just line of sight into the 800 megawatts. So on the call, you talked about monetizing the 800 over time. You just touched on already having 40% of the way through that. So maybe, I guess, I think also Mirko expressed a very high degree of confidence underscored by the conversations you were having with significant potential customers. So help us understand the demand funnel. What types of customers are driving that interest? And how do you think about the mix between hyperscalers, sovereign or government workloads and maybe enterprise customers?

Yes, interesting. So look, I think the most important thing is securing access to power and time to power. If you look around North America, for sure, there's not that much available power. So Canada winds up being fairly interesting market because there is a lot of power generation that's not already sold, not already taken up by the enterprise demand. So access to power, very important. Our role in the Canadian ecosystem for nearly 150 years really positions us well, especially in a world where the Sovereign AI use cases are still ramping up.

But the sovereign nature of assets winds up being important and important for decisions as to allocation of power and power in Canada, largely owned and controlled by governments or quasi-government organizations. So we are right place, right time in terms of that. And we don't love it during the winter, but it's a pretty cool place to go. So as a market for power generation, Canada is a pretty interesting place to be. And given our relationship and ability to build out an AI ecosystem as we've done in, frankly, 11 months since we let folks know we're working on AI Fabric is a pretty good spot to be.

So on Saskatchewan, you described it as a fully contracted take-or-pay 300-megawatt facility with an IRR of approximately 20%, and with additional upside as you think about the Sovereign workloads. So construction is underway, equipment is ordered. I guess, can you walk us through, I guess, the key execution milestones between now and the first revenue? And what are the gating factors? And how should we think about, I guess, perhaps the $400 million in prepayments, setup fees, et cetera?

Yes. So you're right. The revenue side of this, the EBITDA side of this is contractual. So we just need to deliver the facility. As you said, so 96% of the equipment has purchase orders on budget, penalties if the equipment is late in being delivered. So I feel pretty good about that. And then you start looking at just regular construction milestones; so we're prefabricating walls off-site. We'll move those on site. But think of this as get walls up, connect power. And ultimately, what we're doing is its shell, right? I mean we're building a shell in a flat floor, connecting the HVAC chillers, coolers, and the gensets. Our tenants are doing the more detailed electrical work connecting their servers and racks.

And then you had talked about earlier, sorry, I didn't answer your question about who the other tenants would be. Tenants like what we have. So Cerebras, CoreWeave and then ultimately hyperscalers. So the Sovereign AI of it that you asked about, we do have the ability to claw back use cases for Sovereign purposes. It would still be in the facility. It would just mean off-taker would have to move to a different facility. So we're not taking the Sovereign AI risk, but certainly, when the upside is there, we'll be in the right place to capitalize on it. So not quite the direct off-taker yet, but that's why we sold all 300 megawatts to Cerebras and CoreWeave from day 1.

Maybe for some of the folks in the audience and for myself, at least having covered the Canadian ecosystem, but just to try to understand the nuance in the market. There is power within Canada that's unique as you -- coming out of recent -- another session here that's a gating factor for a lot of the AI data center builds and what have you. But do you think this model of -- because a lot of the power is government or quasi-government controlled in Canada.

Do you think this is a model that probably is replicable as you go forward of there's probably going -- if we think about U.S. or non-Canadian AI platforms moving NeoCloud moving -- maybe taking advantage of some of the power in Canada, do you see this model of like, hey, this is your megawatt capacity, but perhaps leaving some for sovereign workloads or being able to perhaps claw back some of that power, some of those megawatts. Is that probably something like a model that probably gets replicated in the future as you think about eating into or some of this demand?

I mean, ultimately, the demand is there. So I certainly think the model is scalable. The -- and look, there -- again, we have line of sight into 800 megawatts of power. There's more than that in Canada. Obviously, we're having conversations to get more access to that. The demand is scalable. The business model is scalable. TBD a little bit on how fast the Sovereign AI use cases drives demand.

So whether or not you have to reserve some infrastructure to kind of change the chicken-and-egg problem historically of the infrastructure requirement to drive use cases and then back around. So again, I know that Sovereign AI use cases for government entities and heavily regulated entities will be there. I can't really underwrite is that 2 months, 6 months, a year, 2 years. It's certainly going to happen. We're in the right place. But until then, we'll keep scaling the other side of the business and driving infrastructure investment in Canada.

And then I think Mirko touched on the possibility of securing additional power beyond the 800 megawatts. Can you give us a sense of where those incremental opportunities might come from geographically? And how you're thinking about the capital commitment required relative to your leverage targets?

Yes. Each province generates their own power. So not to say we're talking to everyone across the map, but we're going to talk to everyone across the map ultimately. And then capital requirements, ultimately, we're not going to do anything to jeopardize our 3.5x target by 2027. Saskatchewan is leverage-neutral once it's up and running. So the economics are quite strong. If we're in a scenario where there's just too much demand that we can't afford it all ourselves, then we'll manage that with third parties.

We're obviously aware of, a, partnerships that we've already signed in other business lines; and b, what's happening in the U.S. and in Europe, especially. So I do think there are opportunities. The ability to fund and come up with partners is not a gating factor for us, ultimately -- gating factor is making sure that we land power and the revenue contracts at the same time because we're in the business of deploying capital, but de-risking the time line as we deploy capital like in Saskatchewan, we're announcing construction plans and a contract when we already have the contracted revenue and EBITDA. So, we're just overall, in this environment, looking to de-risk the overall CapEx spend.

Got it. And just thinking about the remaining megawatts, the remaining 427 megawatts that isn't yet contracted, should we think that this IRR threshold of 20% similar to Saskatchewan? Is that what you're targeting? And I guess, how do you think about the risk-return trade-off?

It's yes, that is what we're targeting. And look, there's a dislocation between the risk reward where we're getting a risk-adjusted return. And at the same time, we already have contracts signed. So it's not a build-it-and-they-will-come. It's a -- we'll build it after we've already signed revenue contracts. And we're not spending money, as you know, on the actual chipset. So it is a very contractual business for us. And increasingly, as we build fiber and AI data centers, our business starts looking a lot more infrastructure-heavy versus competitors in Canada and the U.S.

And how should we think about the ancillary revenue opportunities from Bell AI Fabric? I think Mirko described it as a full-stack, Canadian-controlled AI platform. So, how do you think about that revenue opportunity above and beyond some of the core data center economics we've been discussing so far?

I think you described it exactly accurately. It's all upside for us. So whether it's fiber connectivity, which again, is important in an AI world, obviously, lowest latency makes sense, and we are a fiber builder. We own fiber in Canada. So that's upside for us. Cybersecurity, again, wildly important in an AI world. Bell Cyber is a leading provider of cybersecurity in Canada. We'll wrap that around sales as well.

And then our Ateko business is a managed service professional service, think consulting business for cloud migration, workflow management. So again, important for us to secure powered and make things easy for the ultimate clients as we develop the full AI stack. Some of it we own and control with our expertise. And then, of course, we're going to partner with the Canadian LLM champion, Cohere, Coveo, hyperscalers, which is what we've done for 150 years.

We bring our own specific expertise product by product. And then the overlap expertise is the fact that we can provide end-to-end solutions for our customers. So technology is different, but what we bring to the table with our 150 years of relationships and trust is exactly what's helping us secure power and deliver AI in whether Sovereign or normal use cases in Canada.

And I think zooming out for a second here, as we think about Bell Business Markets, stripping out AI Fabric, I think Ateko and Bell Cyber collectively grew north of 30%. I mean how durable is that organic growth rate? And I guess, what's the pipeline or visibility like for those 2 businesses?

Yes. Well, look, I expect it to continue to grow quite healthily. And if you strip out the AI Fabric revenue in Q1, it was enterprise business was still flat year-over-year, which on a relative basis is still quite strong. And fundamentally, that's because we're managing our core business, but we're also driving growth in Cyber and in Ateko. And if you look at the macro trends, I don't think cybersecurity is becoming any less important.

I think, if anything, the complicated nature of our systems and the kind of ability and desire for companies like Bell and other bigger companies in Canada and U.S. as well to drive efficiencies off of platforms like Salesforce, ServiceNow and Hyperscalers is doing nothing, but getting more important. I mean, let's face it, we're all spending money on these platforms, and we need to drive the value out of those contracts and Ateko helps you do that.

And how should we think about the margin profile of Bell Business Markets as the mix shift towards some of these higher-growth solutions?

Yes. I'm expecting it to be relatively flat. I mean AI Fabric comes in at pretty high margins. The cybersecurity solid margins. Ultimately, on the MSPs side of the world, they offset each other. But ultimately, overall enterprise business, I expect to keep delivering margins.

So now shifting to the Wireless business for a minute here. I think after 3 consecutive quarters of year-on-year improvements in churn, postpaid churn reversed in the first quarter, which I think you guys attributed to just higher number -- higher switching kind of given some of the aggressive competitive offers that were out there. But you've also talked about optimizing your offer strategy for customer lifetime value rather than just chasing volume. So help walk us through the competitive dynamics that maybe you're seeing today? And I guess what gives you confidence the improving trend will resume over time.

Yes. I do think I am still confident. We're still confident that our churn profile improves over time. We all operate in the same market. If you look at our churn impact relative to our competitor churn impact, year-over-year, our churn performance was much better year-over-year than theirs. And look, that's a factor of lots and lots of blocking and tackling and to just overall drive customer experience, right? I mean, number of billing systems from 18 down to 2, just making it right with the customer the first time, like making sure that the truck roll has the install and everything is working from day 1.

Overall, blocking and tackling, customer experience has just improved over time. Customer complaints have gone down. Our share of customer complaints has gone down. But overall, just a focus on driving a better experience for our customers. I mean, driving more and more bundled households keeps improving churn. And ultimately, if you're selling fiber, we're selling other products also, but you're selling fiber. It is just a better technology. It's a better product. So over time, to be able to reduce our churn relative to cable operators, I mean, absolutely, I expect that.

And then on the fiber side, have you changed anything in your offer strategy to kind of help reduce the churn as well, whether it be, I think, contracts or something along those lines?

Well, thanks for the prompt. It is the first time we actually offer wireline contracts. So if we're 40% bundled, wireline contracts are going to help us on the wireless churn side as well. And the other thing that helps us, we used to sell mobility and Internet separately. Now it's mobility and Internet bundle, but content is also part of the bundle in Canada, a little less important in the U.S., I understand.

But in Canada, especially on the streaming service side, and we own Crave, which has our own content, but HBO, STARZ, Showtime content. So the -- we call it [ MI&C ], the Mobility, Internet and Content bundle also helps reduce churn on Internet and cell phones. And for us, we have a cost advantage because we're the owner-operator of Bell Media, so the streaming service itself.

Now shifting to mobile phone ARPU, down 0.8% in the first quarter, an improvement relative to fourth quarter's decline. But on the call, I think Mirko had touched on in the fourth quarter that he thought it would be possible to show some moderation in ARPU growth or show moderate ARPU growth rather by the time you exited 2026. But obviously, recent pricing environment probably makes that a little bit more difficult. I guess, is that a 2027 story at this point in terms of ARPU inflecting back to positivity?

Yes. I think that's right. Again, April looks pretty good. It looks like Q3, Q4 of last year, but 1 month doesn't yet make a trend. So we sat on the sidelines for part of the activity, but you can't sit out for the entire quarter. Ultimately, yes, you just get pushed out by an extra couple of quarters. And when you see total ARPU growth depends on what the industry does over the next few months. So it's hard to pinpoint a specific month, but I'd call it 2027.

And ultimately, I'd say on the contracts that were signed in Q1, kind of fine. There was a bit more bring your own device activity than contracted activity, and there's a bit of an impact on your ARPU, obviously, because that's just the math of it. But the more BYOD you have, you don't actually spend the COA and our Wireless margins actually went up. So there's a little bit of a disconnect between your ARPU performance and your margins. But again, long-term health of the industry, BYOD should remain relatively flat to what it had been second half of last year.

And is it a similar time line as we think about Wireless service revenue inflecting back to positivity?

Yes, probably in and around the same time line. Overage and usage, tough to know if it's flattened out year-over-year, the trend is better. So we'll see. But I mean, the biggest impact, obviously, is the -- what you're signing folks up to on a monthly rate.

Got it. And makes sense. As we think about industry growth, I think you and your peers have described a maturing market, right, maturing Canadian Wireless Market, growing at low single-digit rate, obviously, driven by lower population growth, but still steady penetration increases. How do you think the industry's volume? How do you think about the industry's volume growth from here? Do we need to see policy changes out of Ottawa before seeing improvements in subscriber growth?

**** No, I think you'll continue to see subscriber growth. I don't think it's going to be what it was 5 years ago when immigration new-to-category, new-to-Canada. We were at all-time highs, but our handset penetration has lagged the U.S. and Europe for the last 30 years. There's no real good explanation for it, but we've just been behind on the curve. So the increased penetration will continue to happen over time. And again, Canada in the medium term is going to be a net immigration positive country. If you look at our history, that's certainly driven a lot of population growth. It's just not over the next couple of years. So we're not baking that into the model. But over the medium term, for sure, it's going to be a driver.

And lots of focus on direct-to-device these days. And you mentioned excitement about the AST SpaceMobile partnership from a direct-to-device connectivity perspective. How do we think about the time line for commercial launch? And could this be a meaningful churn reduction tool as well over time?

Yes. It's all of the above type benefits. I mean I do think it's churn reduction. And it's overall just a positive for consumers. I appreciate that in Canada, it's a little bit different than what telcos in the U.S. are thinking about when they're confronting LEO. But for us, it's a positive in terms of, as you say, churn reduction and just an added-value service, right?

So whether you live in a bit more remote area, whether you live in urban and you have a cottage that's outside of wireless coverage, I mean it's -- we look at it as retention, acquisition, and ARPU increase as well. So ultimately, it is just a good product. And longer term, we'll have to see how that actually shapes our ability to reduce some of our legacy copper footprint along the way. But for the shorter-term, I think it's just a benefit for consumers, which benefits us.

Got it. And shifting gears to the broadband business. You added close to 43,000 residential fiber-to-the-home net subscribers in Canada in Q1. And combined with Ziply, we're close to 50,000 net adds. At the same time, the Canadian fiber build is slowing, but how should we think about the trajectory of Internet loadings from here? I mean, how do you balance the strong penetration economics of your existing footprint against the slower industry growth backdrop?

Yes. Our fiber footprint continues to drive net adds, right? I mean it was 43,000 in Q1. It was 45,000 in the quarter 4, 48,000 the quarter before that. So fiber continues to win market share. Where we have fiber, we capture 50% plus of the market. And over the last 3, 4 years, there are a couple of million new homes that aren't fully penetrated. So I think you see just natural continued ramp-up. And ultimately, we have 75% of the wireline footprint in Canada. So it will pull forward wireless for us, but it certainly isn't fully penetrated. And frankly, I don't really see much of a ceiling. It's just a better technology.

And so how would you describe or what's the latest in terms of the competitive environment in your Wireline footprint? Any change?

I'd say fairly stable, right? I mean our competitors came out with Internet revenue growth that seemed pretty good for them. Our Internet growth in Q1 was over 2%, 2.2%. So it's a pretty good market.

And then shifting gears to the U.S. fiber market. I think the expectation is that subscriber momentum will accelerate as construction ramps from here. But you're focused more on the 2027 and 2028 financials. So maybe help us bridge the gap between the slower near-term subscriber trajectory and your confidence or your conviction in the 2027, 2028 ramp. I guess what specifically changes in the back-half of this year? And I guess, how should we think about the cadence of passings and penetration from here?

No. Look, you're spot on. Build engine is the biggest driver of value for us at this point. So 1.4 million fiber locations passed, looking to get to 3 million by the end of 2028. So the biggest driver of value for us in the U.S. is actually building out the fiber footprint. I mean the -- it's really consistent in terms of being able to drive penetration of new fiber footprint. So the biggest driver for us is literally ramping up that build engine. And as you say, that will continue to ramp up through '26, especially as we leverage the partnership with PSP, continue to ramp up in '27 and hit our 3 million homes by the end of 2028. And again, as soon as you build out fiber, the data and Internet subscribers follow from there.

And any -- again, reiterating you just did the 3 million by 2028, 8 million longer term. Any from a supply chain or logistics or obviously, permitting is always a big issue in the U.S. Any snags there or if things are progressing as anticipated?

No, as you say, permitting, right? I mean, it's blocking and tackling and it's permit community by community by community. And if you look at the permits they have, I mean, they're kind of double what they had last year. They've added headcount on the construction side. So it's just ramping up the build side of it. I mean we help bring them some scale in terms of access to suppliers and equipment. So no real issues on that side. It's just how do you ramp up even faster.

And now shifting gears to the 2026 guide on financial guide. So you guided -- residentially guided to a consolidated revenue growth of 1% to 5%, EBITDA growth of 0% to 4% and your CapEx was increased to take -- to contemplate the Saskatchewan build. But after 1 quarter, reiterated all your guidance, I guess, where do you see the most, though, variability within the guidance range? Is it the Wireless pricing environment, the pace of AI Fabric revenue recognition, something else?

Yes. Look, we're confident in our ranges and our guidance at this point. So I don't really see a big impact either way. I do think AI Fabric is probably accelerated a little bit faster than when we talked about it at our Investor Day. So that's a good news story. And frankly, the more that we can rip out spend on legacy networks, legacy product, legacy processes, and reallocate capital towards fiber or AI Fabric or more digital transformation, I mean, we're going to take advantage of that opportunity, and that's what we're looking to do in '26.

Now obviously, that has a bigger revenue, EBITDA, free cash flow impact, '27, '28. But again, if you can drive value now and capture it tomorrow, absolutely, I'm looking to drive that value. So sensitivity of the model, wireless prices, obviously, not a surprise in market pricing would be a variable, but there's nothing that makes us back away from our current guide.

As we think about the 2028 financial targets, I mean, does the upsized AI-powered solutions target of $2 billion relative to $1.5 billion just from Saskatchewan. I mean, does that incremental growth change how you're thinking about the multi-year EBITDA range? Or are there other kind of offsetting factors that have avail -- that have emerged since.

Yes. Look, Saskatchewan alone, we upped our guide after announcing one contract, right? Our free cash flow 3-year CAGR, we upped it from 15% to 16.5% on the back of one contract. So look, as we continue to drive capture of demand that's already out there and sign contracts, within the 73 megawatts that we've already talked about, that's just within our plan. We'll fund that.

Look, if we can grow it a bit above that within the CapEx envelope, then we'll do that. And if there are other 100, 150-megawatt opportunities out there, we're certainly chasing them down. And let's say, so we'll be transparent when it happens, we'll announce it. And if we change the guidance from there, we will, but we'll certainly be transparent about the impact.

At the Investor Day, you outlined $1.5 billion cost-savings target by 2028, with incremental efficiency beyond that, driven in part, I think, by higher self-installs, the 3G network shutdown, IT platform simplification. Can you give us a sense of, I guess, where you are on that journey toward the $1.5 billion? And how much has been realized to date, bigger -- some of the bigger buckets yet to come? And then just maybe help in terms of phasing over the 3-year period?

Yes. I'd say we're just over halfway, right? And we have pretty good line of sight into this. And it's the laundry list that you talked about, and it's a list of 100 other things, ultimately, all within the -- how do we just rip out manual work, simplify our processes. It's more cost efficient for us and it's better for the consumer, right? So as we think about how do you provide better customer experience, better customer service, yes, it reduces your churn.

But in this world, actually leveraging technology means it's more cost-effective and cost-efficient to deliver a better service to the customer. So it's kind of a win on all fronts there. And largely, it's leveraging technology, ripping out manual work and meeting the customer where they actually want to meet with you, as you say, self-installed digital capabilities.

And then with thinking about overall capital allocation, you guys have been pretty consistent in terms of your framework, which is to strengthen the balance sheet, fund strategic priorities, and return capital through a sustainable dividend. But we just talked about some of the simplification you're doing from a cost effort, but you also sold MLSE, more recently, right? The Land Mobile Radio divestiture. But at the same time, you have growth initiatives in terms of $5 billion of CapEx this year because of Saskatchewan, but also Ziply. So maybe help us think about from your seat, specifically as the CFO, how do you think about the tensions between accelerating investment in high-return growth opportunities while maintaining that pace of deleveraging towards 3.5x by the end of '27.

Yes. Well, the good news is that there actually is tension here because we do have significant growth opportunities. So if there was no growth opportunity, it would be very different discussion. But ultimately, look, we drew a line in the sand, we should be deleveraging, we will be deleveraging 3.5x by 2027, we're going to hit that target. On the growth side, we still have the ability within our CapEx envelope to fund growth, whether it's fiber, digital transformation, digital media or AI Fabric.

As you saw with the Saskatchewan announcement, it's net-leverage-neutral very quickly, and we increased the proportion of our revenue and EBITDA that's infra-based and driven by contracts. So there is an ability to fund more AI Fabric and still manage the balance sheet. But fundamentally, we'll hit the 3.5x, and there are plenty of structures out there to fund incremental growth if the demand and contracts are right.

Are there any other non-core assets you'd consider divesting to accelerate that path to 3.5x by 2027?

Yes. Look, the capital allocation is a tougher game, but it's a simpler game in a world where you have attractive opportunities, right? The capital allocation, as we talk about it, it tends to be CapEx focused. But really, it's OpEx as well as assets. So like what we've seen, we announced $7 billion of asset sales not that long ago. We're $6.6 billion of the way there. So yes, there are a couple of other assets that we think we might not be the best owner of and that we can redeploy that capital, pay down debt, and fund our growth opportunities.

Well, Curtis, I think that's a great place to end it. Thank you so much for joining us today, and thanks, everyone.

Great. Thanks for your time.

I'm Gordon Nixon and I'm pleased to preside over this meeting as Chair of the BCE Board of Directors. Before I call the meeting to order, I would like to turn to our Corporate Secretary, Melanie Schweizer, who will provide our land acknowledgement.

[Interpreted] Maintain strong ties with the land. First people play a key role in present and future of the land. Land acknowledgments are invitation to learn, reflect and support actions to our reconciliation. Let's continue to deepening our understanding, supporting indigenous-led initiatives and building relationships rooted in respect, reciprocity and truth.

I will now call the meeting to order. As we announced at our annual meeting this year -- at last year's annual meeting, this year, for the first time, we are conducting our Annual General Meeting in a hybrid format with shareholders attending and able to participate, vote and ask questions at the meeting both live -- both in person and live video webcast through Lumi platform. We welcome all shareholders attending the meeting, both those online and those in the room with us today.

In a moment, we will review the procedures of the meeting and how shareholders can vote, raise points of order, make motions, speak to shareholder proposals and ask questions during the meeting. In the meantime, I will review a few preliminary matters. The business of this meeting will be conducted in both English and in French. For those attending the meeting online, you may choose the language feed at the bottom of the broadcast screen.

Closed captioning is available on all feeds. If you are listening by telephone and you wish to change the language, you must hang up and dial back into the meeting using the phone number that corresponds to the language of your choice, and that is indicated on the website. For those attending the meeting in person, we have made available to you headsets for simultaneous translation of today's proceedings. If you need a headset, please raise your hand and you will get one.

I will now introduce the members of the BCE team joining me on stage today. First is Mirko Bibic, as everyone knows, our President and Chief Executive Officer, and you have already heard from Melanie, our Senior Vice President of Corporate Services and our Corporate Secretary. In accordance with the BCE bylaws, I, as Chair of the Board, will chair this meeting and Melanie will act as Secretary. Louis Vachon, a member of our Board of Directors and incoming Chair, subject to his election later in the meeting, will also be addressing the meeting later on.

And he, along with Mirko, will participate and run the Q&A sessions, so you can ask really hard questions of the Chairman this year. Also attending today's meeting are members of our Board of Directors who will be introduced shortly as well as members of our senior management, including our CFO, Curtis Millen, who along with representatives of Ernst & Young, our shareholders, are here. Before we begin, I would ask Melanie to take us through the procedures of today's meeting.

Thank you, Mr. Chair. Voting during today's meeting will be held both through the Lumi platform and in person. As described in the proxy circular, only registered shareholders and duly appointed proxy holders who received a control number from our transfer agent, TSX Trust Company, may vote during the meeting. You do not need to vote during the meeting if you submitted a proxy as your proxy holder will vote on your behalf.

For those attending online starting now, you can register your vote on all items of business for today's meeting. To vote, click on the voting tab on the left of your screen. You will see the meeting resolutions displayed and canned for each resolution, select one of the voting options available. Your vote will be automatically submitted to our transfer agent after you make your selection. Votes may be changed up to the time voting is closed.

For those attending in person and entitled to vote at the meeting, upon registering with TSX Trust at the meeting today, you should have received a handheld voting device or ballot. Please note that you do not need a device or ballot if you already voted by proxy and do not wish to change your vote. If you don't have a handheld voting device or ballot and need one, please raise your hand. For shareholders attending in person, the voting procedure for today's meeting will be outlined immediately prior to the commencement of the applicable voting period.

The polls will remain open until the Chair declares voting on all matters closed. Preliminary results will be announced later this morning, and final results will be posted on our website. To ask in writing online, click on questions tab on the left of your screen and submit your question. Your question will be read at the appropriate time. Assuming they have been submitted in sufficient time, questions related to the matters of business to be voted on will be addressed at the time such matter is being discussed.

Other questions will be addressed during the question-and-answer session. To ask a question by telephone, call the number appearing on the screen on the meeting page of bce.ca and on the home page of the Lumi platform and then press *1. A Lumi representative will contact you as ask for your 13 digit control number. You will be then unmuted at the appropriate time for you to ask your question live. To ask a question by audio only or video through the Lumi platform, click on the request to speak button at the top right of the broadcast panel.

Allow your browser access to your microphone and camera as applicable and then click on the green check mark. You will be called upon to ask your question and unmuted automatically at the appropriate time. if you are a shareholder or proxy holder attending in person and wish to address the chair with respect to an item being discussed, you should at the appropriate time, go to the microphone located in the aisle. State your name and whether you are a shareholder or proxy holder before presenting your question or comment.

If you prefer to wait to ask a question or make a comment or if your question or comment does not relate to the item being discussed, there will be a general question and comment session at the end of the meeting.

[Interpreted] All the procedures summarized above also apply to the introduction of motions, particularly at the regards of the agenda. For further details, please refer to our procedural code and the Lumi user guide, which are available on our website and on the Lumi platform. For the good conduct of the meeting, questions should be of interest to all shareholders and not personal in nature. If your question is related to a personal matter, for those of you attending in person, a customer service booth has been set up in the hall just outside the meeting room where our customer service representatives will be happy to assist you.

For those attending online, if your question relates to a personal matter, it will not be read and instead a BCE representative will communicate with you after the meeting if you have provided your contact information. To allow us to respond to as many questions as possible during the 90 minutes allotted for this meeting, we will limit each shareholder to one question and ask that it be succinct and limited to a maximum of two minutes. Questions submitted online on the same topic or otherwise related will be grouped together and addressed at the same time.

Any question that cannot be answered during the meeting due to time constraints will be posted on the BCE website with the corresponding answer as soon as practicable after the meeting. I would now like to bring your attention to the notice appearing on screen. Today's remarks will contain forward-looking statements. These are based on several assumptions and are subject to important risks. The notice on screen contains a cautionary statement in this regard and is made on behalf of each speaker whose remarks today will contain forward-looking statements. Finally, I can report that Bertrand Judy and Isabelle Vachon, employees of TSX Trust Company, have been appointed to act as scrutineers of this meeting. Mr. Chair, I now turn the meeting over to you.

Thank you, Melanie. The procedures for a hybrid meeting are almost as long as the meeting itself. Once again, good morning to everyone, and welcome to BCE's 2026 Annual General Shareholders Meeting. It is a pleasure to be here today to share progress that we've made over the past year to compete and win in what is a fast-changing marketplace as well as to deliver long-term value for our BCE shareholders.

Our revitalized brand tagline, connection is everything, underscores the Bell team's fundamental role to enable individuals and businesses to forge meaningful relationships and experiences with each other and with their communities. As Chair of BCE's Board of Directors since 2016, it has been a privilege to work with the executive team to build a strong foundation that ensures that we're facilitating those connections and that Bell is well positioned for growth into the future.

Our efforts are driven by four strategic priorities: First, put the customer first, deliver the best fiber and wireless networks, lead in enterprise and with AI-powered solutions and build a digital media and content powerhouse. In 2025, the Board provided oversight on several transformative initiatives that are accelerating momentum on these four priorities today and in the years to come. Here are just a few highlights.

We introduced three new companies, Ateko, Bell Cyber and Bell AI Fabric, key drivers of our plan to lead in the high-growth enterprise space by harnessing the power of artificial intelligence. We completed the acquisition of Ziply Fiber, expanding our fiber presence in the Pacific Northwest of the United States. And we unveiled our 3-year strategic plan at the BCE Investor Day, which clearly outlines how Bell will meet the growing demand for connectivity while delivering sustainable shareholder returns.

Our long-term strategy reflects a deliberate pivot towards scalable growth platforms, notably AI-powered enterprise solutions and digital media, along with investments in our leading fiber and wireless networks. These platforms are supported by a disciplined capital allocation strategy, including a continued focus on deleveraging and strengthening our balance sheet. Most importantly, the entire team is driven by a shared commitment to deliver a better customer experience, and that is happening.

In my 10 years as Chair, the BCE Board provided oversight during an extraordinary period of industry transition as well as technological advancement. It has been a privilege of working with an executive team to provide guidance on innovative products and services that will continue to create long-term value. As this is my last and final AGM as Chair, I'd like to highlight just a few of those accomplishments of the Bell team over that period. Firstly, the creation of Bell MTS following our acquisition of Manitoba Telecom Services which significantly expanded Broadband communication services in the province.

The launch of 5G wireless, which now covers 89%of the Canadian population. Successfully navigating the unprecedented COVID-19 pandemic and keeping Canadians connected to their family and friends when it was needed most. Advancing our fiber strategy through an accelerated capital allocation plan while working quickly to decommission our Legacy networks. Our digital media strategy powered by Crave, which is expanding the reach and impact of Canadian storytelling through Bell Media's original content and maintaining disciplined oversight through a period of intense industry disruption and difficult economic uncertainty.

In my role as Chair, I have had the privilege of helping to guide CEO succession planning, including the transition from George Cope to Mirko Bibic as CEO in 2020, which set a strong foundation, which has been critical to BCE's ongoing success as Canada's largest communications company. I would like to sincerely thank my fellow directors, our leadership team, all Bell team members and especially our customers and shareholders for their ongoing trust and support. It has been an honor to serve such a historic Canadian company that touches the lives of almost every Canadian.

And I'd like to say a few words of welcome to the incoming Chair of the BCE Board, my good friend, Louis Vachon, an outstanding business and community leader. Louis and I both have roots in the Canadian banking industry, and I have had the pleasure of working with him more closely since he joined the BCE Board in 2022. As former CEO of National Bank of Canada and through his service on boards of several iconic Canadian companies everywhere, Louis has a deep knowledge and experience to deliver long-term value for BCE's customers and shareholders.

The BCE Board is very lucky to have Louis as it Chair, and I can assure you it is in capable hands. BCE was on a roll until it hit a very difficult patch, which was COVID in the post-COVID period, which had a very upending impact on our industry. But it reset, and it is once again an incredibly exciting time for our company. BCE has done the hard work of putting the building blocks in place that we can take advantage of opportunities that lie ahead for us and achieve solid and sustainable growth by connecting Canadians and each other to the world.

On behalf of the Board, I would like to thank you once again for your confidence and support. The meeting today will proceed as follows. After confirming the establishment of a quorum, we will proceed with the receipt of our 2025 consolidated financial statements and the auditor's report. We will then vote on the election of directors, the appointment of Ernst & Young as our auditors and an advisory resolution on executive compensation and as well as shareholder proposal.

Our President and Chief Executive Officer, Mirko Bibic, will then address the meeting, following which will he announce the results of the votes. Louis Vachon, our BCE Board member and incoming Chair, will then be Chair and will then address the meeting. And finally, and perhaps most importantly, we will conclude the meeting with a question-and-answer session.

Starting with agenda item #1, the scrutineers have provided me with their report on attendance which be filed with the records of this meeting. The attendance report, together with proxies, which I hold, confirm that shareholders representing at least 25% of all outstanding shares of BCE are entitled to vote and are in attendance at the meeting. I therefore declare that the meeting is properly constituted for the transaction of such business as may properly be brought before it.

Moving to Item #2. The BCE annual financial report for 2025 contains the consolidated financial statements with the auditor's report thereon. A copy of the 2025 annual financial report will be filed with the records of this meeting. We have with us today Curtis Millen, our Chief Financial Officer; as well as representatives from Ernst & Young, Janice Roth, to answer any questions that you may have on our financial statements. Melanie, I would ask you whether there are any questions online with respect to this item of business.

There are no questions on this item, Mr Chair.

Are there any questions in the room on the financial statements? Seeing none, we will, therefore, proceed to the next agenda item. The next item of business on the agenda is the election of our directors. There are 13 directors to be elected and 13 eligible candidates who have been nominated. The director nominees are Mirko Bibic, Robert Dexter, Katherine Lee, Monique Leroux, Sheila Murray, Louis Pagnutti, Calin Rovinescu, Karen Sheriff, Jennifer Tory, Louis Vachon, Stephen Howe, Johan Wibergh and Cornell Wright. These are your Board nominees.

We will now turn to questions related to this item of business. Are there any questions in the room with respect to the election of directors? Melanie, are there any questions online?

There are no questions online, Mr. Chair.

In order to facilitate the conduct of the votes, Melanie, who is a BCE shareholder, will be presenting the motions with respect to certain items on the agenda, and we have arranged for certain other shareholders or proxy holders to second these motions. I would now ask Melanie to move the election of the nominees of 13 directors positions to be filled at today's meeting.

Mr. Chair, I move that each of the 13 persons previously named be elected a Director of BCE, Inc. until the earlier of the end of the next shareholder meeting -- Annual Shareholder Meeting and the date they cease to hold office.

Thank you, Melanie. Seconding the motion is [Martine Nadon], who began with Bell in 1983 as a librarian in this very building. She is now a valued member of our network experience team, leading the team of 19 employees.

My name is [Martine Nadon]. I am an employee of shareholders, and I second this proposal.

We will now proceed with the vote. I would ask Melanie to review the voting procedures.

Thank you, Mr. Chair. As a reminder, earlier in the meeting, I reviewed voting instructions for those voting online. The instructions are also available under the home tab on your screen and in the Lumi AGM user guide available on bce.ca. I remind you that if you have already voted by proxy, your vote will already have been compiled by the scrutineers and you do not need to vote again.

For those in person with us today, for users of the handheld voting device, please select the appropriate resolution at the appropriate time. The voting options will be displayed on your screen. For ballot users, place a check mark or X in the box labeled for or against next to each nominee's name. Hold on to your ballot as it will only be collected after the last vote is completed.

Thank you, Melanie. The next item on the agenda is the appointment of Ernst & Young LLP as BCE auditors. Melanie, are there any online questions related to this item?

There are no online questions, Mr. Chair.

Any in the room? Seeing none, I would now ask Melanie to move for the election of Ernst & Young as our auditors.

Mr. Chair, I move that Ernst & Young LLP be appointed as auditors of BCE until the next Annual Shareholder Meeting.

Thank you, Melanie. Seconding this motion is Serge Savard, who has been with Bell since 1988 and works as a central office technician. He has seen the introduction of all new technologies since he started and participated in the launch of Internet, high-speed services and then fiber services. Serge, can you please make this motion?

Mr. President, my name is Serge Savard, and I am an employee and shareholder, and I second this proposal.

The name's exactly of one of my all-time favorite hockey players. So that's particularly good. The next item on the agenda is the advisory vote on BCE's approach to executive compensation. Melanie, are there any questions with respect to this item of business?

There are no online questions, Mr. Chair.

Are there any questions in the room with respect to this item of business? Okay. We're moving along here. Melanie, could you please move for the approval of the advisory resolution on executive compensation?

Mr. Chair, I move that the advisory resolution on executive compensation be approved.

Thank you. Seconding this motion is Annie Ether. Annie has been with Bell for over 23 years and is a member of our customer experience team, leading and scaling digital adoption across our service teams. She is also heavily involved with our French language committee. Annie, can you please make this motion? Second this motion.

[Interpreted] Mr. President my name is [Annie Ether] and I am both an employee and a shareholder and I support the motion.

We will now proceed with the vote. The last item to be submitted to a vote is a shareholder proposal. Please note that voting on all these matters will close after this item. I will now invite Mr. Willie Gagnon, a representative of MEDAC, to present and move the shareholder proposal. Louis, over to you.

[Interpreted] My name is Willie Gagnon, MEDAC is [indiscernible] shareholder. We exist for 30 years, and I'm here for the last 20 years. We're really, really happy to see you here today in person. And I remind the assembly, we had this proposition of shareholder for the return in person, and we're really happy. I remember you were against last year. So I'm not going to reread the answer that you gave us, but we're really happy to see you in person.

We can shake hands. And as administrators, people are working here, other shareholders and MEDAC member in the room, we submitted two proposition of shareholders which were submitted to all the societies in these actions for the MEDAC account. But I'm also acting as for other shareholders, and I propose this, and I can second the motion also, correct me if I'm wrong. So two propositions, want to strengthen the participation of shareholder to the general assembly annual.

And last year, for the first time since we exist, we existed at not the quorum for a company that we are a shareholder. So we were asking why did this happen? We hope that these reasons are not systemic depending on the hypothesis. So we propose to all our society in our portfolio measures to support the participation of the shareholder, stakeholder, which are already in place. But the fourth measures that we wanted publication of just more board so that we could look just one glimpse of an eye to see if the participation increases or decreases.

So this is what we wanted, a small board or screen. And if you would have accepted to have the Board, well, we wouldn't have voted on that. So unfortunately, we were there. It would have been simple. There's only one that accompanies our shareholders' proposition that was produced by Broadridge. So the data to do this kind of Board are available. It wasn't a great expense. And this measure is really difficult for a shareholder.

It's tough to do by himself. So it would be simple for the company to have this kind of Board. So we invite all of the shareholders and you submit also to framing the AI to preserve the human aspect of the business with the customer and in general. And you didn't go to vote on this because you say that, well, policies of AI respect with BCE respect the conduct code of the federal government to develop our AI generative system. And notably, we wanted to make sure that you had the same principle for this code also.

So I understand that BCE did not adhere to this code, but BCE says they adhere to the same principle of this code. So we hope that the policies that you have in place at that subject. We understand that BCE is a technological company and AI question is really important. So we hope that the policy in place will avoid these kind of mistakes. So we didn't go to vote on that because we feel satisfied by the answer that we were given. So these are my comments, and thank you for the time you allow us.

Thank you very much, Willie. And your work over the years has been very fruitful and beneficial to shareholder rights. And clearly, the hybrid meeting was something that you proposed last year, and I hope people are enjoying that. And I can assure you on the AI, we're spending a tremendous amount of time at the Board on AI and the issues surrounding technological advancements. The response, of course, is included in our proxy circular, but I would ask whether there are any specific questions with respect to the shareholder proposal. I assume there are none online.

There are no online questions, Mr. Chair.

Okay. Thank you very much again, Mr. Gagnon. And the matters being submitted to a vote has now been completed. I would declare that the voting on all matters are now closed, and I would ask that representatives of TSX Trust collect any ballots. The results will be announced before the question-and-answer period. I will now ask our President, Mirko Bibic, our Chief Executive Officer, to address the meeting.

[Interpreted] Thank you, Gordon. Good morning. I am pleased to be here to speak to you about the year ahead for BCE and our strategic moves we're making to drive a total shareholder value on the long term. One year ago at our 2025 AGM, I spoke to you about the decision BCE was making to strengthen our balance sheet by ensuring that our capital markets approach a fit purpose.

Then in October, we held an Investor Day. We laid out a clear operating strategy completed with a 3-year financial outlook. Today, I'm pleased to say we are firmly in execution mode. Our objective for this year and beyond is to continue to deliver for our customers and our shareholders, guided by our four key strategic priorities. like were mentioned by Gord in his speech. These priorities build on what Bells has done successfully for 145 years, connect people to each other, connect businesses to their customer and connect Canadians to the latest technology.

Let me expand briefly on how we're delivering against our priority. Number one, put customer first. We have more than 240 million direct interactions with our customers every year. Our goal is to ensure we deliver the best customer experience possible during each of these touch points, and we're making progress through the use of AI. Customer can increasingly self-serve through our digital tools including 24/7 AI-powered virtual assistant while still having the choice and the option to speak with a team member if they prefer.

Our second priority is to deliver the best fiber Internet and 5G wireless network. Our networks are in the critical infrastructure that powers Canada's digital economy, delivering exceptional value for our customers and our shareholders alike. Bell has an unparalleled customer base in Canada with 3 million fiber Internet customers, 10.5 million wireless subscribers and 4 million TV and content subscribers. We're one of the only 3 carriers globally with overlapping fiber, wireless and media assets.

It's a unique combination that gives us a powerful advantage to drive growth and that our competitors can't easily replicate. In 2025, we made a major milestone with completion of the Ziply Fiber acquisition. Ziply Fiber will be a material growth driver for BCE as we continue to build our fiber location in the U.S. In part, thanks to Network FiberCo, our strategic partnership with PSP Investment headquartered here in Montreal. Our third priority is to lead an enterprise with AI-powered solutions.

AI is the next wave of critical digital infrastructure, which will power the Canadian economy. And as with the telephone and the Internet before, Bell is there. We're there playing a leading role in delivering for the country. In the past year, we launched 3 game-changing businesses. Ateko, our technology services business, which is actually based upstairs in this historic BCE headquarters; Bell AI Fabric, Canada's largest full-stack AI compute project; and Bell Cyber, our cybersecurity center of excellence.

Together, these three innovative businesses are significantly expanding the market for AI solutions and driving substantial growth for the company. And by 2028, our goal is for these three businesses, Ateko, Bell Cyber and Bell AI Fabric to form a $2 billion AI-powered solutions business. Bell AI Fabric, in particular, has grown rapidly from a standing start just 1 year ago. In fact, we launched it on May 29, 2025. It is fast becoming the heartbeat of AI in Canada, offering customers a made-in-Canada solution comprising our nationwide fiber network, data center infrastructure, software, cloud capabilities, professional services through Ateko and our leading partner ecosystem.

Two of our facilities are already online with more to come this year. Earlier this year, actually, we told Canadians the Bell AI Fabric story through a national TV campaign, and I'd like you to take a look and share it with you here.

[Presentation]

What's more we strengthen Canada's AI ecosystem through partnerships with leading Canadian technology companies, Canadian companies, and they include Cohere, Coveo, Hypertec and Celestica. In March, we announced plans to build the country's largest purpose-built AI data center, the largest in Canada, I'm repeating it, a new 300-megawatt facility in Saskatchewan expected to drive significant recurring revenue, EBITDA and free cash flow growth.

The Saskatchewan data center campus represents Bell's largest ever investment in the province. It will place Saskatchewan at the center of Canada's growing AI economy and generate an estimated $12 billion in long-term economic value, including substantial tax revenues and at least 800 construction, engineering and technical jobs during the development phase. Early construction work is already underway. Just this week, we announced a team of local and regional construction firms supporting these initial phases, ensuring the Saskatchewan workers and businesses are benefiting from this investment from day 1.

Just as important, this project has been designed from the outset to respect local communities and the environment. Like all of our Bell AI fabric sites, the facility will use a closed-loop water cooling system that does not draw on municipal groundwater. We're also collaborating with local universities in the George Gordon First Nation to explore opportunities for waste heat reuse on campuses and in nearby development projects. And in close consultation with local landowners, we're working to minimize community impacts through responsible development, including measures to reduce noise, light and traffic.

And there's much more to come. Business adoption of AI will only continue to increase, and Bell is more than ready to help Canadian governments and enterprises win. Now to our fourth priority, which is to build a digital media and content powerhouse. Our media strategy is pretty simple. It's to deliver the best content to Canadians when and how they want it. And as audiences shift to digital platforms, we're moving with them, and we're unlocking growth along the way. And Crave is at the heart of that strategy.

Today, we have 4.7 million subscribers. And by the end of 2028, we expect that number to hit 6 million. Over the past year, Crave original content like Empathie and heated Rivalry has taken the world by storm, making a lasting cultural impact. This success reflects Bell Media's commitment to invest in Canadian storytelling that connects with audiences at home and that also resonates around the world.

And that strengthens our national identity and it reinforces our cultural sovereignty. Through Crave, we're investing in stories that reflect who we are as a country in English and in French, and I couldn't be prouder of the talent and creativity of our Bell Media team. And you don't have to take my word for it, Bell Media earned 202 nominations at this year's Canadian Screen Awards. Against this backdrop of transformation, we also completed a major brand refresh in the last year.

Chair mentioned it in his opening remarks, and our brand refresh has a new tagline and that's connection is everything, and it's a reflection of a more human relevant and connected future. And to bring this vision to life, -- last year, we collaborated with renowned Quebec filmmaker, Xavier Dolan, on a short film highlighting the moments behind every network connection. The film received global recognition and it won Best Director at the 2026 Brand Film Awards presented by PRWeek and Campaign last week.

And I'd like to share it with you now.

[Presentation]

And that brings me back to what's defined Bell for 145 years. From the first telephones to smartphones, copper wires to fiber networks and next-gen AI infrastructure, Bell plays a defining role in connecting Canadians to work, to opportunity to the best content and of course, to each other. It's our purpose to advance how people connect with each other and the world.

[Interpreted]Before I wrap up and one more piece of exciting news since we're in Montreal, 2 weeks ago, we announced a new chapter for Formula 1 Grand Prix of Canada with the launch of Bell GP Canada, our rebranded promotion group. This rebranding reflects our long-term commitment to one of Canada's most prestigious international sporting events and showcase in Canada. And the unique ability to Bell to connect sports, media and live experience to deliver lasting impact for Montreal and Canada.

I'd like to offer my warmest wishes, of course, and thanks to Gordon Nixon, who is retiring today as Chair of the Board, as you know. Gord, your steady guidance and leadership over the past decade have been instrumental in Bell's transformation to the company that we are today with the momentum that we have today.

[Interpreted] I also would like to welcome our incoming Chair of the Board, Louis Vachon. Shareholders have already benefited from Louis's leadership and expertise over the past few years. Louis, I look forward to working with you as a Chair to deliver strong outcomes for our customers and investor. Thank you.

Thank you very much, Mirko. Thank you, Mirko. And I will now ask Melanie to provide the preliminary results of the scrutineers' tabulation of today's votes.

Thank you, Mr. Chair. The scrutineers confirm the following preliminary vote results. All director nominees received at least 97.9% votes for. At least 99.4% of votes are in favor of the appointment of Ernst & Young LLP as auditors. The advisory resolution on executive compensation is approved by approximately 96% of the votes and approximately 1.84% of the votes are in favor of the shareholder proposal. Therefore, it is defeated. The scrutineer's final report will be available shortly after the meeting.

Thank you, Melanie. It's now my pleasure to invite Louis Vachon, who is the incoming Chair of BCE to address the meeting and to join Mirko for the question-and-answer period, after which I will return to close the meeting. Louis? Thank you.

[Interpreted] Ladies and gentlemen, shareholders, before I say anything else, I would like to highlight Gord's remarkable work over the last 10 years. Gord, on behalf of myself and all the Board members, I sincerely thank you. Your leadership and expertise have helped BCE through a period of great transformation. It is an honor for me to continue this work and assume the Chairmanship of the Board of Directors of BCE, a company that plays a crucial role in the Canadian economy.

It is my pleasure to begin this new mandate here with you. Only a few steps away from the national bank place where I built my career and join you all today in the iconic Beaver Hall Building in the heart of Montreal. Bell has been deeply rooted in Quebec since its foundation and Montreal, the French-speaking metropolis of North America remains at the heart of its identity, its history and its future.

Today, we are facing an unstable global economic context. Trade policies, tariffs measure reminds us of how complex the environment in which we operate can be. In this context, the role of strong Canadian companies like PCE is more important than ever. They are at the heart of our productivity and our economic prosperity. They strengthen the country's economic sovereignty and stimulate large-scale innovation. In an economy that increasingly relies on data and technology, having reliable, secure and above all, sovereign digital infrastructure is not just an advantage.

It's a fundamental strategic imperative. And that's precisely what makes Bell special. For nearly 150 years, Bell has been connected people with each other and the world. It has been at the forefront of every technological transformation in Canada, the phone, the Internet, fiber optics, 5G. Today, it's at the heart of the next wave of progress, AI. Bell is at the heart of Artificial Intelligence in the revolution of Canada. We are developing a robust and sovereign digital infrastructure through responsible investment and lasting partnership.

This concerted approach has been instrumental in building a most prosperous country while continuing to develop a robust and forward-looking company. BCE's position is clear. We are here to serve our customers and our investors. Bell has gone through nearly a 1.5 century of major technological and economic transformation. It has done so by adapting, investing and remaining faithful to its fundamental mission, connecting Canadians.

Today, the company relies on an experienced and committed exclusive team. It was a clear strategy anchored in a culture of operational excellence and innovation. As Chairman of the Board of Directors, I am committed to working closely with my colleagues on the Board and the leadership team to continue to provide rigorous governance and informed decision-making aligned with a long-term interest of the company, its employees, its customers and its shareholders. I am honored to be able to contribute in this new capacity to the pursuit of this mission. I thank you for your trust, and I am delighted to be able to contribute with you to the next chapter of Bell's history. Thank you.

Melanie, can you remind us of procedures, please?

Yes, of course. As a reminder, if your question is related to a personal matter, and you are attending today in person, a customer service booth has been set up in the hall just outside the room where our service representatives will be happy to assist you. Similarly, for those attending online, if your question relates to a personal matter, a Bell representative will communicate with you after the meeting if you have provided your contact information.

To enable as many shareholders as possible to have the opportunity to be heard today, we ask that you limit your time of each question or comment to a maximum of 2 minutes. For those online, as previously described, you can submit your question online, ask a question by telephone or ask a question by audio or video through the integrated function of the Lumi Platform. Specific instructions are shown on your screen. For those in the room, please come to the microphone. You can ask your question when called upon. In all cases, please state your name before stating your question or comment and indicate if you are a shareholder or proxy holder. The rules of procedure that we outlined at the beginning of the meeting will continue to apply for this question-and-answer session.

Do we have any questions in the room? Mr. Gagnon?

Mr. President, welcome. Listen, I'm here seated since the beginning of the meeting, and I hear more talk of AI than I thought I would. This is one of our propositions that we made that was removed on the base that you have a policy on AI. And I hear a lot of the positive aspect today, obviously, concerning AI. But there is a pure aspect of this technology also of this era that we are living. We -- everybody has seen terminator in 1984, and we're well conscious of the threat that may happen.

But transparency of data is something that doesn't work. So the energy question is really the bottleneck about the AI needs a lot of energy. Are you aware of this problem that will necessarily come up eventually. The question that's broadly documented hallucination of the language model, LLM like they call in English, which are based on probability of an answer that's given quickly. And these models are giving ador, ideologic tickets, bias that's favored by the LLM.

It's a big, big bunch of problems. We accepted to remove this vote or question, but we don't hear a lot about the risk that AI represents here today. It's wonderful, a new data center, but I don't hear the risk. We do have risk, and they are important. And I would like to hear about the risk. You say yourself that you wanted to be trustful, secure and sovereign, keep the control here. So how about the sovereignty if the totality of the shareholders are detained by external shareholders. So you understand what this represents. I would have loved to hear you talk today about the risk. Is there an issue? Is there a problem of managing the risk? And this can affect the value of the BCE value, but the value of BCE. So I would like to hear something on that, if you have anything to say concerning that.

I can go. Thank you, Mr. Gagnon, for the questions. I remind you that there's a law on external proprietary that applies itself on communications. So this is one answer of one of your points. Concerning AI, it's unavoidable. A big part of AI, of course, is infrastructure, technological infrastructure, communication infrastructure. They are always part of what Bell delivers in the country, to the customers and to the shareholders.

So we were already -- we were always there. We'll still be there. And concerning the risk, we are aware of the risk

[audio gap]

data center specialized in AI. I mentioned that while I was talking, our development will be super responsible ecological-wise. And by the responsible usage, we have a clear policy really strict that was announced internally, and we'll continue to follow it.

[Interpreted] Just to give you a bit of a viewpoint of discussions we are having. A few minutes, we were talking all the risk committee. They meet 5 times a year, and we talk about AI. But the latest discussions, she said it's so important that we would like to talk about it at the Board meeting. So we share your reality on that.

It's obvious. We know that there's a lot of advantage possible with AI. And it also opens another aspect, risk factor, and we are working really hard, and we are aware of that.

[Interpreted] It reassures me, but when we talk about buying Bell's value, we want to know what you just said. So these kind of things, this should be to the shareholder, and I don't represent all of them. But it's important for us to know a company like yours, what you hear on that. But I would like to read this one thing.

[Interpreted] But I repeat for so many years, you heard me at the Bank National, but the risk management culture at the beginning, this is human question. First of all, humans are taking decision. Yes, technology plays a big role. But our approach like here, a great culture of a great organization, risk management is a human factor. And after that is a technological factor. So we need the right person at the right time, at the right place with great training, ethical and all this will allow us to go through. Technology, everybody sees the technology. It changes so quickly. We need to have an organization that adapts to the changes. So that's essential.

We have one question online. Who's reading it?

I'll read it. we have a question in writing from Alan Best. It reads as follows. Good morning Mr. Bibic. First, Mr. Nixon, thank you for your insightful leadership over many years. Enjoy your next chapter. The dividend cut was painful. As the company evolves from a telco to a techco, I am interested to know about the prospects of dividend restoration to former levels. How much of a priority is this objective? When will we see evidence of progress in this direction?

Okay. I'll take this. Melanie, can you actually read the next one as well because I think I can answer them together.

Absolutely. The next question is in writing from Jeff Carlson. BCE's share price has been flat for the past 18 months and is approximately half of what it was in 2022. BCE's share performance ranks last amongst its peers. This poor performance is despite the projects management have discussed today, many of which have been well known for many months, even years. What assurances do shareholders have that your current strategies and so-called improved fiscal governance will have any positive effect on share price?

Okay. Thank you, Mr. Carlson and Mr. Best for the two questions, which essentially relate to the share price performance and as well as what can we expect with the dividend. And so we have to really go back on this a year ago. So it's in response to Mr. Carlson, fact, it's only really a year ago in February of 2025, where we started to communicate the new strategic plan.

And in October of last year at our Investor Day, we really put a lot of detail around that plan. So it's a fairly kind of recent plan, the plan that I outlined in my opening statement that we're communicating consistently to investors. And we are in the early days of that plan. We have significant momentum behind it. So the AI, we just launched that growth vector in May of last year, and it is growing significantly. Our fiber performance in Canada and the U.S. is very strong. And in 2020, we began the very, very hard work of changing the strategic and cultural approach at Bell Media to change from a traditional broadcaster where traditional broadcasters are in significant decline everywhere around the world to a digital media leader.

And you can see in terms of some of the data that I shared with you in my opening statements, that momentum is clearly there. And Crave is actually Crave we're hyped on. Bell has been around for 145 years. And in terms of net gain of customers, Crave last year was essentially the largest selling product in terms of net gains in a 1-year period that we've ever had. So I think about how incredible that is. So that's the strategy.

That's the operational strategy, and it's actually fairly recent and it's got some momentum. So now if we go to the share price and the dividend. Part of that strategy is a capital markets approach, a new capital markets approach, and it has three elements. The first element is to strengthen the balance sheet. and we've got progress there. We've optimized the cost of capital, and we started the process of reducing our debt levels, and we have clear targets that we're committed to in 2027 and beyond.

The second part of our capital market strategy is to fund growth. I'm not going to repeat what I just said. We have the four growth vectors. We're making sure that we're directing investment to further that growth. And then the third part of the strategy is to return capital to shareholders. And we signaled in October of last year as it relates to the dividend. We, of course, reduced the dividend last May, a year ago, actually.

But in October of last year, we said that we intend to return back to shareholders over a 3-year period, approximately $5 billion in dividends. And if you do the math, that actually in response to Mr. Best's question, that signals that we plan to keep the dividend at the level it's at, at least for the next three years and the kind of the funds by reducing the dividend, the excess cash flow we are putting into growth and into reducing the debt. So I hope that answers those two questions, and thank you very much for them.

Can I add?

Absolutely.

Very short answer. If you look at the insider trading reports, you'll see that I've been buying shares of BCE in the last 12 months. So -- why? Because I think the shares a good value, and I believe in what management is trying to do. That's the shortest and the best answer I can give you. Any other questions? I don't believe there is.

There are no further questions online.

Okay. I would now invite Gord Nixon to join us and close the meeting one last time.

Sorry, Nicole Bear, a proxy holder. My question is, Bell has identified data centers and digital infrastructure as key growth areas. Can the Board outline how Bell is ensuring it has the skilled workforce capacity to deliver on this strategy? And what investments are being made in workforce development to support long-term execution?

Yes, absolutely. Happy to -- thank you for that. Very good question. So there's three prongs to our AI strategy. There's Ateko. Ateco is a technology services service provider. And Ateko was actually born out of a company called FX Innovation, which is a Montreal-based company. And it was -- we acquired it in 2023 from the founders and Caisse de depot. And now that company is now part of DCE. It's called Ateko, and it continues to be led by the founders and an incredible team of employees who are specialists in the technologies that they advise their clients on.

So we have that fundamental skill set from the founders and the employees we hire, and we've tripled the employee base of Ateco since we acquired it in 2023. Bell Cyber is a combination of the expert network security team that we've always been known for at Bell for decades and decades, combined with cybersecurity experts from a company we acquired called Stratejm 2 years ago, and it's based in Mississauga and now that's called Bell Cyber. So fundamentally formed of a team of telecom network experts and cyber experts.

And as far as Bell AI Fabric, the data center business, it is led by John Watson and Michel Riche, who are on the executive team. Michele is based here in Ottawa, and we have a full team of folks who are experts in construction of data centers and operation of -- operating data centers, and we have a team of Canadian technology companies that work with us, whether or not it's Covio, Cohere, et cetera, who are themselves in their own right, AI experts. So we're putting a lot of attention and taking great care to make sure that we have the management team and the employees to deliver on the promise that we make to our customers in this space.

Just one more. Jeff. Good morning, Mr. Chair, cable repair technician of 26 years, BCE shareholder. In a rapidly evolving telecommunications and technology environment, how does the Board assess Bell's ability to attract, retain and develop talent? And is there a defined long-term workforce strategy aligned with the company's transformation goals?

Another very good question.

Thank you. I appreciate that question, too. So this is -- the communications and media industries that we operate in are in constant flux. And clearly, I mean, Gordon mentioned in his opening remarks, the last 5 years, particularly as we're going through COVID and coming out have been difficult for a number of reasons. The technology has changed, customer preferences have changed, some regulatory rules have changed. We have a number of segments of our business that are in perpetual decline.

There's nothing that can be done anywhere in the world to change -- the traditional copper home phone, people are disconnecting. Copper Internet, low-speed Internet, nobody wants that. Everyone wants broadband. Satellite TV, it's not particularly interesting to most Canadians unless they don't have a choice. They want streaming. So we're seeing a shift in the employee base in those segments. However, we're seeing growth in other segments of our business that are high growth, as I was mentioning in response to the previous question, a lot of employment at Ateko, a lot of employment at cyber, a lot of employment of AI.

We've got a lot of technology experts in the customer experience part of our business where we're trying to constantly deploy new technologies to improve the customer experience. So we're making sure in terms of our -- how we manage the workforce that we're getting the right skills within Bell to be able to kind of activate those growth segments while kind of managing digital diligently, of course, the workforce in those declining segments of our business. And we have training programs, and we have a new graduate program to bring in new talent in the company and develop them as they evolve and as they begin their careers and continue their careers. Those are the kinds of things we're doing.

Any other questions from the room? I don't see any other questions online.

There are no other questions online.

Okay. Gord?

Thank you very much, Louis, and Mirko. And thank you to our shareholders. So obviously, some very good questions. Just one observation. When I think back when I used to cover telcos back in the days as an investment bank, you thought of them as sort of state utilities, rate of return regulated. And as you get a flavor today, the industry has just changed so much and so quickly and the future is going to be that much quicker.

And I can tell you, I will now watch as a shareholder and -- but I do think it's an incredibly exciting future. And you've got a great team, both at the Board, but in particular, management who really drive the strategy. And 20 years ago, you never thought you'd be sitting at a telecom -- I shouldn't call it a telecommunications company, but a telecommunications company meeting be talking about AI and quantum and all the other things that are now discussed at the Board. So very exciting, and it has been an honor for me to have been part of that transition. And as I said, I look forward to observing as a shareholder in the many years to come. I now declare the meeting closed, and I'd like to thank everybody for participating at our Annual Shareholders' Meeting today, and I'd like to thank you for your continued support of the organization going forward. So thank you very much.

Good morning, ladies and gentlemen. Welcome to the BCE Q1 2026 Results Conference Call. I would now like to turn the meeting over to Kris Somers. Please go ahead, Mr. Somers.

Thank you, Matthew. Good morning, everyone, and thank you for joining our call. With me here today are Mirko Bibic, BCE's President and CEO, and our CFO, Curtis Millen. You can find all our Q1 disclosure documents on the Investor Relations page of the bce.ca website, which we posted earlier this morning.

Before we begin, I would like to draw your attention to our safe harbor statement on Slide 2, reminding you that today's slide presentation and remarks made during the call will include forward-looking information, and therefore, are subject to risks and uncertainties. Results could differ materially. We disclaim any obligation to update forward-looking statements, except as required by law. Please refer to our publicly filed documents for more details on assumptions and risks.

With that out of the way, I'll turn the call over to Mirko.

Good morning, everyone. Thanks, Kris. Our Q1 results demonstrate continued disciplined execution across all four of our strategic priorities in what remains a competitive operating environment. Consolidated revenue was up 4% and adjusted EBITDA grew 2.9%. As we've outlined consistently, our capital allocation is organized around three priorities: to strengthen the balance sheet through disciplined de-leveraging, fund our strategic priorities and, of course, return capital to shareholders through a sustainable dividend. We continue to execute against that framework in Q1.

Most recently, we announced the divestiture of our land mobile radio business to Motorola Solutions for $675 million, and that's at an attractive valuation of approximately 10x EBITDA. The latest in a series of actions to simplify the business and accelerate our path to our leverage targets. We're making significant progress across each of our four strategic priorities as well, and I want to walk you through them, starting with putting the customer first.

I'm on Slide 3. You see that we continue to advance a number of initiatives to improve the overall value proposition and service experience for our customers, including the expansion of Internet contracts in Ontario, which give customers greater price certainty, continued scaling of hardware-free Fibe TV and the full launch of our voice virtual assistant across Bell, Virgin Plus and Lucky Mobile. Each of these supports longer-term, more stable customer relationships and a lower cost to serve.

Fiber continues to be a key growth driver for us. In Canada, we added close to 43,000 residential FTTH subscribers in the quarter with demand remaining solid across our footprint. Combined with the contribution from Ziply Fiber, total residential fiber net adds were close to 50,000 and Internet revenue across our North American fiber platforms grew 15% year-over-year.

In Wireless now, Q1 was in an unusually competitive quarter. Promotional activity across the industry extended well beyond typical seasonal windows. We were deliberate in how we responded, staying out of the most aggressive pricing early in the quarter and participating selectively where we saw longer-term value. That discipline is reflected in our results. Strong postpaid net adds of close to 17,000, a 21% increase in gross activations and continued resilience in Bell branded performance. Early indicators suggest the market is normalizing, and our focus remains on lifetime economics, not quarter-to-quarter volume.

Video net subscriber additions swung to positive, improving approximately 26,000 year-over-year on strong uptake of the streaming bundles we launched in the second half of last year. That content pull-through, together with growing adoption of subscriptions across our fiber base is driving meaningful momentum in product intensity, which is a key metric we're tracking against our Investor Day framework.

Turning now to our third strategic priority, which is to lead in enterprise with AI-powered solutions. This is where I want to spend a bit more time today with you because Bell AI Fabric is creating considerable value in a very short period of time, and I want to make sure investors fully understand the story.

Let me start with a simple framing. Bell sits at the intersection of secure, high-performance networks, trusted enterprise relationships, access to significant power and now purpose-built AI infrastructure with a time-to-compute advantage. No other Canadian company has assembled this combination, and it's very difficult to replicate. That's our competitive advantage. Last year, we outlined our ambition to lead in this space, and we introduced 3 businesses: Ateko, Bell Cyber and Bell AI Fabric. Each is closely tied to our core strengths in connectivity, distribution and trust. Since then, progress has only accelerated.

I want to begin with Saskatchewan because it's a landmark investment for Bell and for the country's AI future. Less than 2 months ago, we announced a fully contracted 300-megawatt purpose-built AI data center in Saskatchewan. It's a transformational project that meaningfully improves our long-term growth profile and is incremental to the financial framework we laid out at Investor Day. Our construction partners have mobilized on site and preliminary work is underway. I'll walk you through what that looks like on the ground when we get to Slide 5.

At full run rate, as we've shared before, this facility alone is expected to contribute approximately $500 million of revenue, $400 million of EBITDA and over $250 million of free cash flow at an IRR of approximately 20% at the data center level with additional upside from sovereign workloads and related services on top. Beyond Saskatchewan, our broader AI Fabric ecosystem continues to scale. In late March, we launched our Merit BC facility. Consistent with our model, Bell is providing the building, power and cooling. The tenant supplies and funds all compute hardware. The facility uses a closed-loop liquid cooled design that does not draw from municipal water resources. The capacity at Merit is part of the approximately 73 megawatts of AI Fabric capacity we referenced back in October.

At this time, we have 4 fully contracted facilities, Mission Flat and Merit BC, which are both live, as you know. We have Winnipeg, which will go live early in the second half of this year, and that one is on an operating lease basis. Those 3 constitute 29 megawatts of the 73 megawatts we guided to at Investor Day. And of course, we have Saskatchewan on top of that, which is under construction. We also continue to build out the sovereign AI solutions ecosystem during the quarter. We announced strategic partnerships with Coveo to deliver sovereign AI-powered digital services, with Hypertech to deliver end-to-end sovereign AI infrastructure built, hosted and operate in Canada and with SAP to strengthen Canada's digital sovereignty with cloud and AI infrastructure and post quarter with Celestica to advance the development of a Canadian sovereign AI infrastructure stack. Each of these partnerships reinforces a critical point. Bell AI Fabric is not just about data centers. It's a full stack Canadian-controlled AI platform with infrastructure, connectivity, security, integration and services, working with best-in-class partners to meet the needs of governments, enterprises and research institutions that require their AI workloads to remain here in Canada.

And this brings me now to the financial results in Enterprise. Bell Business Markets revenue, which we're disclosing for the first time this quarter, was up 9.7% in the quarter, driven by 113% growth in AI-powered solutions. That's a powerful number and it reflects the compounding momentum across all 3 of our AI-powered businesses. Again, I'll note that the Merit facility contributed to the quarter, and Curtis will walk you through the financial details around that. We increased our AI-powered solutions revenue objective from approximately $1.5 billion to approximately $2 billion by 2028 when we made the Saskatchewan announcement, and we're confident in that target. And frankly, I see potential beyond it. We have line of sight to monetizing approximately 800 megawatts of power over time, and our pipeline of interest remains deep and active.

In short, AI-powered solutions is creating significant differentiated value for this company. It's closely tied to our core business. It's disciplined, demand-led and return-driven, and it's a growth vector that no other Canadian telecom has.

Turning now to our fourth strategic priority, which is to build a Digital Media content powerhouse. Our digital pivot in media is now well into its sixth year, and the momentum is clear. When I became CEO in 2020, Digital represented 19% of Bell Media's revenue, and today, it's 46%. That's up 3 points year-over-year, and it's still growing. It's a fundamental transformation of this business, and it's translating directly into subscriber growth, advertiser interest and new monetization streams. Q1 was the most watched quarter in Crave history. Our subscriber base grew 25% year-over-year to more than 4.7 million today, powered by a 59% increase in direct-to-consumer streaming subscribers. That's exceptional growth in any market. And with our target of 6 million subscribers by 2028, we have a clear runway ahead.

What's driving this is the combination of premium original content, a significantly expanded library, the streaming bundles we launched in the second half of last year and continued improvements to the product experience, including targeted marketing offers -- efforts pardon me, in the French language market. Another recent addition is SNL, which will simulcast on Crave and CTV beginning this fall, one of the most watched shows on television and a strong signal of the content value we're building across both platforms. We also continue to solidify our long-term sports content leadership. Over the last few months, we extended regional media rights with the Senators, the [indiscernible] Canadians, the Winnipeg Jets and became the new Canadian home of the Toronto [ Tempo ] and the WNBA. We expect to announce additional major rights renewals in the near future. These are important long-duration agreements that reinforce our position as Canada's leading sports broadcaster across TSN in English and RDS in French. Sports content is the single most powerful driver of live viewership, advertising premium and subscriber retention, and we intend to maintain our leadership. And on that note and looking ahead, we're excited about the FIFA World Cup this summer. We have exclusivity on 104 games across our platforms, which presents a significant audience and monetization opportunity for Bell Media.

The third element I want to highlight is our growing ability to monetize original content internationally. Our Crave original series, [ Yaga ] and The Office Movers have been acquired by Sky for the U.K. and Ireland. And just last week, Yaga was acquired by AMC for the U.S. market with additional territories expected to follow. This builds on the global success of Heated Rivalry, which continued to generate cultural impact through Q1, earning a Peabody award, multiple Canadian screen awards and a second season renewal. The key here is that they aren't one-offs. They reflect a deliberate strategy to invest in premium Canadian storytelling and then extend the value of that content across the full value chain, including through our majority ownership of [ Sphere Abacus ], our global content distribution arm. As a reminder, our focus is for Bell Media to deliver consistent annual revenue and EBITDA growth while contributing meaningfully to free cash flow for BCE. We're on pace to do exactly that in 2026.

I want to pause now on Slide 5 because I think it tells an important story. So this is back to Bell AI Fabric. In the spirit of transparently tracking and communicating our progress on our strategic initiatives, let me provide you some more detail on the construction progress here. On the left, you can see our Mission Flat facility. That's the one in Kamloops, BC, the very first one we opened last June. This is where Grok's AI inference technology is live and serving workloads today. Our second facility is the one in Merit BC. That went from dirt to a fully operational AI data center in 9 months. Together, these experiences gave us a proven reproducible playbook for everything that's followed.

And on the right is Saskatchewan. This is what momentum looks like in real time. Our construction partners have mobilized on site. You can see the earthworks underway, site stripping, [indiscernible] testing, heavy equipment on the ground. The development agreement has been approved by the Rural Municipality of Sherwood and our development permit application is currently under review. We selected our early works contractors and over half a dozen additional trade contractors in the Regina region. Long lead equipment, including generators and cooling systems have been ordered and on schedule. We expect all major permits in place by July, and we remain on track for the first phase to come online in the first half of next year. So let's take a step back and look at the trajectory.

A year ago, Bell AI Fabric was an idea and a single facility in Kamloops. Today, we have the data centers I summarized earlier and line of sight to monetizing approximately 800 megawatts of power.

Now turning to Slide 6. As you can see, we continue to track and measure ourselves against disciplined execution on the Investor Day targets we laid out last [indiscernible]. You see a sample of those metrics on the slide and the progress. And before I turn it over to Curtis in a moment, I want to touch on two more things, capital allocation and capital investment. On capital allocation, we've been very consistent. In February 2025, we laid out a clear plan: Simplify the business, strengthen the balance sheet, focus capital on higher return opportunities. And we reinforced all of that at Investor Day with significant transparency around everything we were going to do. We're committed to continue to share our progress transparently and regularly, and that's what we continue to do today.

Since then, we've been executing one step at a time. We completed the sale of our interest in [indiscernible] at a 10x return. We exited Bell Smart Home and most recently, of course, the Land Mobile Radio divestiture. The road map hasn't changed. We're going to optimize the balance sheet. We're going to fund the strategic priorities, which are high growth, and we're going to return capital to shareholders through our sustainable dividend. And we're going to do that while maintaining the financial discipline and the flexibility to execute against our 3-year plan, and a reminder, we're only 1 quarter into that 3-year plan.

On CapEx, as early as 2023, we saw where the environment was headed. We made deliberate choices back then, to reduce spending on legacy segments and reallocate investment to growth segments. That's what we've done. That's what we're going to continue to do. Our Canadian Telecom CapEx has decreased by over $2 billion from $5.1 billion in 2022 to below $3 billion in 2026. That's putting aside the highly accretive AI Fabric investments. Our underlying Canadian CapEx intensity is approximately 12%, with Wireless capital intensity at an industry low 7%. Our Canadian Telecom CapEx will continue to decline.

In the current environment, we've seen others in the industry recalibrate their capital spending. We totally understand that because it's what we've been doing. We laid out this discipline clearly at Investor Day, and we've been executing against it for 3-plus years. But what makes our story different is where we're investing the capital we do deploy. We have a significant growth vector in AI-powered solutions that's intrinsically tied to our core business and that no one else in Canada has. Our capital allocation is shifting toward higher return growth opportunities like AI Fabric and our U.S. Fiber platform as we maintain discipline on the core telecom side.

Before I hand it over to Curtis, I want to acknowledge our entire Bell team. The results we're sharing today reflect the dedication and focus of everyone who works for this company across the country and in the U.S., serving our customers, growing the business and executing on the plan we've laid out. I'm proud of what the team [indiscernible]. And Curtis, over to you now to take the team through the Q1 financial and operating results in detail. Thank you.

Thank you, Mirko, and good morning, everyone. I'll begin on Slide 8 with BC's consolidated financial results. Total revenue grew 4% in the quarter, driven by the contribution from Ziply Fiber and continued strong momentum at Bell Business Markets, where AI-powered Solutions revenue more than doubled year-over-year. Adjusted EBITDA was up 2.9%, driven by the contribution from Ziply Fiber and the flow-through of higher product revenue. Margin declined 40 basis points to 42.7%. As we previously indicated, the mix of growth in the business is evolving. Some of our higher-growth services naturally carry a different margin profile than our legacy businesses, which tend to be higher margin.

Our focus is on driving absolute EBITDA dollar growth and free cash flow growth. Adjusted EPS was down $0.06 compared to last year, reflecting higher depreciation and [ amort ] expense and interest costs, consistent with our 2026 guidance assumptions. On CapEx, total CapEx -- total capital expenditures were up 15.4%, reflecting Ziply's fiber build-out in the U.S. and capital investments to support the growth of our Bell AI Fabric business as we build out data centers across Canada. Free cash flow increased 0.8% to $804 million. I would note that beginning this quarter, we updated our definition of free cash flow to exclude income taxes paid on significant divestitures, which improves comparability quarter-over-quarter, year-over-year and does not affect any previously reported amounts. In Q1, we paid $542 million in income taxes related to the MLSC sale. That amount is excluded from the free cash flow figure I just referenced, but it does impact cash flows from operating activities, which analysts should keep in mind when reviewing the cash flow statement.

Turning to Bell CTS Canada on Slide 9. I want to highlight a few disclosure enhancements this quarter that we believe will be helpful for investors. First, we've updated our Internet sub metrics to include wholesale subscribers. This is consistent with how we reported prior to 2019 and reflects the impact of the CRTC's mandated fiber access decision on how we operate the business. We've also introduced an additional residential fiber-to-the-home metric. Previously reported 2025 figures have been restated for comparability. Second, we broadened our IPTV subscriber definition to include bundled streaming service subscribers, customers who subscribe to a package that includes at least one third-party streaming service and one BCE streaming service. This is now reported under a new video subscriber metric, and again, 2025 figures have been restated. With that context, let me walk through the sub metrics, starting with Wireless.

Strength of our distribution network and the Premium Bell brand helped deliver 16,947 postpaid mobile phone net adds in an unusually competitive quarter compared to a net loss of close to 10,000 in Q1 of last year. Postpaid churn was 1.34%. After 3 consecutive quarters of year-over-year improvement through Q4, the trend reversed in Q1, reflecting a higher number of switchers driven by some of the most aggressive competitive offers we've seen in a seasonally low volume quarter. As the competitive environment normalizes, we expect the improving trend to resume, our customer-first initiatives continue to take hold. ARPU was down 0.8%, consistent with the Q4 decline and significantly improved from the 1.8% decline in Q1 of last year. The decrease reflects the flow-through of the more aggressive pricing environment. We've been encouraged to see a return to more rational behavior in April and continue to focus on premium Bell-branded subscribers and Fiber-led bundling to support the quality of our subscriber base.

Moving to Internet. Residential fiber-to-the-home net adds, our new separately disclosed metric totaled 42,750 in the quarter, a strong result. Where we have Fiber, demand remains solid and our market share position continues to be strong. Turning to Video. Video net adds totaled 10,103 in the quarter compared to a net loss of close to 16,000 in Q1 last year, an improvement of approximately 26,000 year-over-year. This was driven by strong uptake of the streaming bundles we launched in the second half of last year, and it speaks directly to the product intensity momentum that Mirko Bibic referenced. Turning to the financial results for Bell CTS Canada. Bell Business Markets was a clear highlight this quarter. BBM revenue grew 9.7% in Q1, driven by 113% growth in AI-powered solutions. That's Ateko, Bell Cyber and Bell AI Fabric combined. All 3 components contributed to this growth result.

Beginning in Q1, we're providing incremental transparency by disclosing BBM operating revenues with a service and product split, consistent with the transparency commitments we made at Investor Day. In late March, we launched our second Bell AI Fabric data center in Mereit, D.C. Revenue and EBITDA were recognized upon delivery under finance lease accounting. Going forward, we expect the majority of our AI Fabric agreements to be structured as operating leases, including our Winnipeg data center and our announced Saskatchewan data center. The accounting treatment has no impact on the free cash flow we expect to capture over the term of the agreement. Wireless service revenue was down 0.6%, the improving trajectory we saw through 2025 was disrupted by the competitive pricing environment in Q1. Wireless product revenue was down 6.3%, reflecting fewer device upgrades and lower contracted sales as the market shifted towards [indiscernible] your own device activations.

Turning to Bell CTS U.S. on Slide 10. Ziply Fiber continues to perform in line with our expectations and the plan we shared at Investor Day. Q1 total revenue was $234 million. Adjusted EBITDA was $102 million, representing a 43.6% margin, an improvement from 43.1% in Q4. Margin performance reflects continued operating discipline and efficiencies within the business. On the subscriber front, Ziply added nearly 7,000 net new fiber customers in the quarter, penetration across new and existing markets tracking consistent with historical cohort performance. Where we have Fiber, we continue to win our share. The Ziply's plan to reach approximately 3 million fiber passings by the end of 2028 is on track. As construction ramps through the balance of the year, we expect both operating and subscriber momentum to accelerate.

Over to Bell Media on Slide 11. Total revenue was up 0.4% in the quarter. Subscriber revenue grew 11.8%, driven by continued strength in Crave and Sports [indiscernible] streaming as well as the benefit of a retroactive adjustment related to a contract renewal with a Canadian TV distributor. Advertising revenue was down 12.8%, reflecting continued softness in non-sports traditional advertising demand, lower audio revenue following last year's radio station divestitures, the absence of the prior year benefit from the federal election and the shift of advertising dollars to the principal broadcaster of the 2026 Olympic Winter Games. That said, our Digital strategy continues to have significant momentum.

Digital Video Advertising revenue grew 32% year-over-year, and total Digital revenues now represent 46% of Bell Media revenue, up 3 points from a year ago. Operating costs were up 1.1%, driven by contractual content cost increases for premium sports and entertainment programming, partly offset by lower labor costs and operating efficiencies, resulting in an EBITDA decline of 2.5%. As Mirko noted, we remain on pace to deliver positive revenue and EBITDA growth for the full year.

Turning to the balance sheet on Slide 12. We ended Q1 with $4.3 billion of total available liquidity, up from $2.5 billion at year-end, supported by $1.5 billion hybrid note issuance completed in February and a $750 million public debt offering in late March. Our liquidity position is strong and provides significant financial flexibility. Our defined benefit pension plans remain in excellent shape with a solvency surplus of approximately $4.5 billion and a solvency ratio of approximately 123%. We continue to benefit from the full contribution [indiscernible]. Net debt leverage was approximately 3.8x at the end of Q1, essentially unchanged from year-end. A couple of important items to unpack here.

First, we paid $542 million of cash taxes in Q1 related to the $4.7 billion sale of our MLSC stake. That's a onetime cash outflow that is excluded from our free cash flow definition, but did reduce cash on hand in the quarter. Second, our reported leverage still reflects only 8 months of Ziply Fiber EBITDA in the trailing 12-month calculation. On a pro forma basis, adjusted to include a full 12 months of Ziply fiber EBITDA, our net debt leverage ratio would be approximately 3.7x. Looking ahead, we have a clear line of sight to further de-leveraging. The announced disposition of our Land Mobile Radio Network Services business to Motorola Solutions for $675 million is expected to close in Q4 and upon closing, will improve our net debt leverage ratio by approximately 0.04x. We remain firmly on track to achieve our target net debt leverage ratio of 3.5x by the end of 2027 and to move below that level in 2028, while we continue to fund our strategic growth priorities.

Turning to our 2026 financial targets on Slide 13. As a reminder, we updated our 2026 guidance on March 16, solely to reflect the expected financial impact of the Saskatchewan AI data center. Table on the slide shows both the original February guidance and the revised March guidance side by side, so you can see the impact of our build in 2026. We expect to begin recognizing revenue and EBITDA from Saskatchewan in 2027. We remain confident in our full year guidance ranges. We're delivering on the commitments we made on de-leveraging, on capital discipline and on free cash flow growth. With that, I'll turn the call back over to Kris and the operator to begin Q&A.

Thank you, Curtis. Before we start Q&A, I just want to remind everyone that due to time constraints this morning because of our AGM taking place after this call [Operator Instructions] With that, Matthew, we're ready to take our first question.

Our first question is from Drew McReynolds from RBC.

Just Mirko, on the regulatory environment. I think it's a little bit confusing. On the Wireless side, there's some kind of archaic kind of price control type things being implemented, on the Wireline side, it looks like we've got a relatively constructive TPIA kind of final access rates on fiber. And then out of Ottawa, it looks like they want to build, but sometimes that's not obvious in telecom. So love to just get a [indiscernible] updated view from you. And then in terms of the CapEx reduction across the space, just how could that evolve over time if the investment climate, i.e., regulatory environment improves?

Thanks for the question, Drew. I think the company's, BCE's views on kind of the regulatory environment writ large pretty well known. We've been staunch defenders of facilities-based competition, but facilities-based competition, off premise on an environment where companies are encouraged to invest in their networks, and that drives long-term sustainable competition. So I'm not going to kind of re-litigate all of that. I also don't intend to re-litigate the wholesale access decision for fiber. Our views are well known on that. And -- but when you put all these things together, whether or not it's the kind of more kind of micro rules that are coming out in wireless that you referred to or the bigger kind of more policy-oriented fundamental rules like fiber access, put all those together.

-- and clearly, it's having an impact on investment in the industry. And this is something I personally have been talking about for as long as I've operated in the industry, which is January 2004 and as much a believer that if you create a framework that encourages investment, investment will come. And if you create an environment that discourages investment, investment will suffer. And you just take a look at -- I refer back to 2022 because that's when we started to pull back on core Canadian telecom CapEx. But if you just look at the capital investments over that short period of time in our industry, on an annual basis, there is literally multiple billions of dollars of annual CapEx that are no longer being invested. So I mean, that's frankly unfortunate.

Now look what we're doing. We're being very, very disciplined in our core segment capital allocation, especially being very disciplined on legacy segments within the core business. Thankfully, we saw this a couple of years ago. Thankfully, we've developed some highly differentiated opportunities where we can deploy capital in high-growth, high-return segments that aren't regulated. So that's how we've pivoted. If the environment for the core businesses in the country were to shift, I'm sure capital would flow back.

Our next question is from Maher Yaghi from Scotiabank.

I just wanted to double down on the Saskatchewan investment. So you guys mentioned you disclosed that you're going to get $400 million of prepayments and setup fees. Have you received any of those in Q1? Or when should we expect to see those flow into your balance sheet? And will they show up in the cash flow statement in working capital or deferred revenue is going to start showing those numbers? And the second question on that, is, can you provide some of the contractual protections you have with those customers in Saskatchewan? If there were delays, downsizing or exits from them in terms of termination fees, minimum payments, credit support, et cetera. And again, finally, on that, with the schedule that you have -- to have full capacity run rate by late 2027, what are the key building milestones that we should be thinking about in order to assess your advancement on that project?

I'll jump in. Maher, there's a lot to unpack, so we'll circle back if we miss anything. So no, in terms of spend to date, we have spent some CapEx in Saskatchewan, but it's less than $20 million in quarter. So again, some spending we're off and running, but no payments that we've made that would then be refunded. Again, that would reduce our net capital at risk, but that hasn't happened yet. I mean, ultimately, we're looking to spend more CapEx. I'd say Q2 and Q3 are going to be the heavier CapEx spends where purchase orders for equipment, as Mirko said, over 90% of our equipment, we have purchase orders in. And so when that equipment starts coming in, CapEx will go up, and we'll make sure to disclose what is gross, what is net and what refunds have actually been credited along the way.

To flip to your next question, we do have standard protections, won't list them all, but it is a take-or-pay contract. So it's not a contract where, okay, they only need 60% along the way and then ramps up. It's a take-or-pay contract. Then in terms of milestones along the way, again, we'll be transparent. We'll provide information along the way. I think there are a few different phases. One is permitting and getting the site ready, which you see is well underway. So the earthworks, the piling. The second is putting up the four walls, which eventually you'll see on site. We're actually doing some prefab work off-site right now so that we, again, remain efficient in our time line. So I would say prep work, prefab, start putting up walls and then installing gensets cooling, et cetera. So we'll keep our breast, but that's how I kind of bucket the different milestones.

Our next question is from Stephanie Price from CIBC World Markets.

I'll stick with AI. And Mirko, I think you mentioned upside that you see to the $2 billion 2028 AI-powered Solutions target. Just curious if you can give us any update on line of sight to deploying the additional, I think it's about 400 megawatts of power or any additional data points you have on the demand environment here?

I think I shouldn't be too specific other than to say a very high degree of confidence in our ability to monetize the 800 megawatts for a reasonable period of time. And that very high degree of confidence comes from the nature of the discussions we're having with a number of significant potential customers, very significant customers. So the conversations are in great shape, and that would be both on AI Fabric. And certainly, there's momentum in the parts of the AI Solutions business that is outside the data centers. So the ancillary services, a lot of momentum there.

Again, if you take a look at AI Powered Solutions generally and even if you pull out the Merit facility, there's been a strong growth there across Ateko and Bell Cyber. And just a reminder, just back to your question, Stephanie, we did say, put Saskatchewan aside because that was incremental. But if you go back to the fairly conservative 73-megawatts that we said we would monetize over a 3-year period, we're already 40% of that 73-megawatts fully contracted, and we're only 1 quarter into a kind of basically a 3-year guide. So I didn't think we'd be 40% of the way there at the end of Q1 when we outlined the plan back in October. So that's why expressing a high degree of confidence.

Our next question is from Tim Casey from BMO Capital Markets.

Mirko, both you and Curtis in your comments talked about how when pricing normalizes coming out of Q1, can you just walk through why you think that? I mean, what's going to change in behavior given we're in a low growth environment and high penetration environment? What gives you confidence that, that pricing environment in both Wireless and Wireline is going to improve going forward?

Thanks for the question, Tim. So I mean the first data point is that so far in Q2, we're only a month in. Pricing has stabilized. So that's a positive sign. Now pretty -- second point is just generally as we operate, when you're in a low-growth environment, I subscribe to kind of what analysts like have been saying, which is in that low-growth environment, pricing discipline should prevail over everything else. I don't plan to get into who did what in Q1 and when. But I will emphasize what our plan has been, and it's consistent, focus on the premium Bell brand where we have the better ability to increase product intensity.

And by the way, in product intensity, I'm obviously referring to both Fiber and the streaming content bundles that we have. And we will have to continue to differentiate ourselves on customer experience. So we -- going back, kind of first signs in Q2 positive in terms of price stability. Secondly, we don't plan to lead on pricing, and we're going to focus on overall value prop. We're going to optimize lifetime economics. But ultimately, it is a competitive market. So we have to kind of check and adjust along the way every once in a while. But so far, so good in Q2.

How about on the bundling side? Are you seeing any lessening or moderation of intensity there?

Tim, no, on the fiber-led bundling, it's actually up a little bit in Q1 versus our embedded base. So no signs of slowing down. Again, we do have the biggest fiber footprint in Canada. So we're certainly leveraging that product advantage.

Our next question is from Sebastiano Petti from JPMorgan.

A quick housekeeping question. If you could provide the, I guess, wholesale contribution to retail Internet adds in the first quarter because I think if you look at it on an adjusted basis, retail wholesale was a drag or a decline in 1Q of '25. And so I wasn't sure if maybe you could provide us with the wholesale contribution in 1Q '26. We kind of have a like-for-like as we kind of think about the subsequent quarters. So that's the first question.

And then second question, obviously, lots of focus around satellite broadband and direct-to-device connectivity on the Wireless side as well. I guess, are you seeing any impact from satellite broadband in your maybe more rural non-fiber markets? Obviously, Fiber wins in the FTTH footprint. But above and beyond that, are you seeing any maybe incremental nibbling on the margins there?

And then lots of headlines recently with ASTS, Space Mobile. Can you guys maybe help us think about how you see that product evolving over time and what your kind of ambitions are there, obviously? And how do you kind of see it as table stakes going forward as you kind of think about your consumer led or trying to meet your consumers where they are in terms of product demand?

Thanks, Sebastian. I'll do the second part, and then, [indiscernible], you can handle the first question. So on the second part, we're really excited about our partnership with AST and the upcoming service that we'll be able to deliver to Canadian consumers to solidify the network experience they have with us, particularly on the direct-to-device side, where where we don't have coverage. So that's going to be the principal use case for us, but we recognize that in -- with AST, we'll be able to provide voice broadband, streaming, data, all of it. So quite excited about the partnership with AST and in fact, we're in the cap table. So we're excited about that, too. So that's on AST.

More broadly on Satellite Broadband and its impact in rural. Satellite Broadband, generally speaking, like now I'm going to give you a macro answer. We're not seeing it have an impact where we have fiber, and you can see it in our strong fiber numbers. So nothing replaces fiber, frankly, for broadband. In rural areas, where we have legacy copper, low-speed DSL, and that's not competitive. So whether or not it's a Tier 1 cable or fixed wireless or satellite broadband, you can expect to continue to see losses where we have DSL. So that's just the facts and whether or not it's broadband -- Satellite Broadband or something else that's eating away at our customer base there kind of really doesn't matter which one it is. So that's kind of my answer there. I hope that's helpful, Sebastiano, on satellite broadband and AST.

And Sebastiano, on the first part of your question. So we did restate 2025. So it is apples-to-apples. And going forward, that is how we're going to report. And we do think it's just how we monetize the network in this current rate environment. So we think it's more appropriate to share it on a combined basis. But again, it is apples-to-apples period-over-period.

Yes. But if we look at the new reporting versus the old reporting, you can see that there's a decline of, call it, 6,000 in 1Q, right, on your new reporting relative to your old reporting. So I wasn't sure if there is wholesale is a contributing factor to the 14%. Or is it -- it would report it have been higher or lower without wholesale is the question essentially.

Yes. I would assume wholesale impact year-over-year has had a bigger impact given the rate environment. But again, it is still monetization of our network going forward. So everything is driving revenue.

And the Retail performance remains quite strong. I mean retail, I mean, our own branded performance remains quite strong.

Our next question is from Jerome Dubreuil from Desjardins Securities.

Two on AI Fabric. The first one is a follow-up to Stephanie's question on the 427 megawatt of power that is not contracted yet. You said you're pretty confident to be able to monetize that. Any chance you can talk about whether this could be made at kind of similar IRRs and what you're talking about on the Saskatchewan side?

And the second one on AI Fabric is if you can kind of quantify or talk about your ability to be -- to secure additional power going forward in Canada?

Thanks, Jerome. Yes. So the first question is, yes, we're still -- we have our eyes set on -- or objectives set on strong returns through monetization of the remaining power we have access to. Remember, and I reiterated this in my opening remarks, our approach on all this is going to be return-led, demand driven. So if the demand sign the contracts, invest the capital to build, generate the returns.

So return-led demand driven. And on -- is there a possibility of having more than 800 megawatts to monetize? Yes, that is possible. We keep looking at opportunities. So we have nothing to announce in terms of access to power beyond 800 megawatts, but it's something we're looking at. If the opportunities arise, we will definitely seize upon them.

Our next question is from Vince Valentini from TD Securities.

Clarification first, Curtis. Can you give us what the revenue and EBITDA was from the Merit B.C facility this quarter? And then secondly, we're talking about these subs and the definition changes. Fine, it makes perfect sense to count wholesale and account streaming subs. Can I just like make sure you're not changing any executive compensation formulas to give yourselves bonuses based on subs given the change in definition? It's just you're changing it because you think that's a more transparent way to show it to us?

No, sub growth, sub volumes, connections, none of that is baked into any of the metrics for our compensation. Our compensation is based -- certainly the long-term compensation, Vince, as you know, we've talked about this before, is based on driving free cash flow and hitting our leverage targets.

And then Vince, to your question on the AI Fabric, if you look to the product revenue change year-over-year, it's about $100 million. You can -- roughly, that's the impact of the finance lease facility.

One more thing actually on the Vince, just jumping in here on the question around the sub metrics and particularly around the content ones. I think Curtis has handled already the fiber subs. But on the streaming bundles, let me explain that kind of the philosophy behind the change. If you go all the way back to 1999, when we launched Satellite TV, what the Bell consumer business has been offering to consumers is bundled content. And that's what we offer. So that was Satellite TV at first, and then we had Fibe TV, Gen 1, Gen 2, Gen 3, and we're into hardware free TV and now we're into streaming content bundles. All of those is just about providing bundles of content to consumers. So we shouldn't kind of measure ourselves based on the technology we use to deliver that. It's the fact that we're delivering bundled content. That's why we changed the subscriber metrics for TV.

I appreciate that, Marco. Just curious, sorry, on the $100 million revenue, we kind of derive that I agree from the product revenue. It's really the EBITDA and the margins. I mean I assume this is positive margin product revenue, like 20%, 25% margin. Is that somewhere in the ballpark?

Yes. I'd say it's a little higher than that and in line with the numbers we provided for the entirety of the 73-megawatt portfolio.

Our next question is from Batya Levi from UBS.

Can you talk a little bit about the trends that you're seeing in the U.S. maybe in terms of the competitive intensity and pricing you're seeing in the market? And a quick reminder of Ziply contribution for revenue and EBITDA would be helpful. I think you had mentioned that you would expect revenues to grow double digits. Is that still the outlook?

Well, the first one -- I'll take the first one, [indiscernible]. So the underlying fundamentals for Ziply are there. They remain there. The demand for fiber is very strong. Customers prefer fiber. There's no different in the U.S. than it is in Canada, as you know. And particularly where we have fiber, the penetration gains are following the profile that Ziply has had since its inception and creation in 2020 and in line with what we see at Bell where we have fiber. So all the long-term economics all remain very supportive on that front.

And as far as the competitive dynamics are concerned, again, so I'm telling -- when I'm saying that our penetration gains where we have fiber remain as expected and in line with what we've seen in the past, that includes -- the more recent period where some of the cable competitors have been more aggressive on pricing. And more recently, we've seen better stability or more stability on broadband pricing where we operate in the U.S. from our major competitors compared to perhaps the end of last year.

And then in terms of the contribution, so in Q1 last year, Batya, it's Curtis, right, it's $234 million of revenue and just over $100 million of EBITDA. So representing growth if you just multiply it by 4% versus the 0.9% that we talked about in 2025 for Ziply fiber. But ultimately, the growth for us is continue to drive our footprint expansion, leverage our partnership with PSP to fund incremental footprint build. I would say Q1 of '26 was the first time that Network FiberCo actually deployed capital. So that will continue to ramp and continue to help Ziply drive penetration and subscriber growth.

And the real growth metric for us is by the time we get to 2028, right, drive way more subs and significant revenue and EBITDA growth. So kind of short-term percentages -- percent growth will be good, but we're looking for total dollars of contribution as we continue to ramp and get through some of the initial ramp. So '27, '28 financials are what I'm focused on.

Our next question is from Matthew Griffiths from Bank of America.

I just want to circle back again to the AI-powered revenue. So just some clarifications, maybe just for my benefit. But for the AI Fabric, is all of that revenue going to get grouped into the product revenue as these facilities come online? And then the growth in AI-powered revenue overall seems to be -- and maybe you can give some color on the other like Ateko and Cyber's contribution to that growth because it's partially because of the Merit facility being delivered, that was near the end of the quarter, and I can't imagine that was at that stage, a really big driver of the year-over-year increase. Just maybe some details on like the other part of the [indiscernible] that is driving that line would be helpful.

Sure. Matt, it's Curtis. So the Merit facility is recognized as a finance fee. So yes, it does hit -- it benefits the product revenue, and that's the roughly $100 million year-over-year increase that you would see there. So the first 2 facilities, Mission Flat and Merit, both accounted for as finance leases. Again, the accounting -- the revenue and EBITDA accounting follows the contract. There is no difference at all in free cash flow. We capture free cash flow over the term of the contract. So we'll continue to reap the free cash flow benefit over time.

The Winnipeg facility is operating lease. That's why you don't see much of a benefit in this quarter. But again, free cash flow over time, revenue -- service revenue and EBITDA over time as well as CapEx. So again, for Winnipeg operating lease, you saw CapEx in Q1, we actually spent, but you haven't seen the impact of the benefit of revenue in EBITDA. And then when you look at Saskatchewan, again, that's operating lease. So you're seeing the burden of CapEx hit our financials, but revenue will be service revenue over time and EBITDA will be captured over time as well. And we do expect the majority of our AI Fabric contracts signed going forward to have operating lease treatment.

Okay. Got it. And then the contribution of -- to the growth from Cyber or Ateko? Or are you just saying from the Fabric...

No. If you strip away AI Fabric from AI-powered solutions, so Atekco and Bell Cyber collectively are both growing and collectively north of 30% year-over-year growth.

Well I think that was our last question, just given timing here. So thank you all again for your participation on the call this morning. Curtis and I will be available throughout the day for follow-up questions or clarifications. Thank you to all, and have a great day.

Thanks, everyone.

Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.

Good morning. Welcome to the BCE conference call following the announcement of the Bell AI Fabric Data Center in Saskatchewan. I would now like to turn the meeting over to Kris Somers. Please go ahead, Mr. Somers.

Thank you, Matthew. Good morning, everyone, and thank you for joining on short notice. As you're aware by now, this morning, we announced that we are building a new 300-megawatt data center in Saskatchewan. The purpose of today's call is to provide you with additional details and perspective on this project. This morning, we will have prepared remarks from Mirko Bibic, President and CEO of BCE and Bell Canada; John Watson, Group President of Business Markets, AI Fabric and Ateko; and Curtis Millen, our Chief Financial Officer. We will also have with us today Dan Rink, President of AI Fabric, who will be on the line to support Q&A.

Before we begin, I'd like to draw your attention to our safe harbor statement on Slide 2, reminding you that today's slide presentation and remarks made during the call will include forward-looking information, and therefore, are subject to risks and uncertainties. Results could differ materially. We disclaim any obligation to update forward-looking statements, except as required by law.

With that out of the way, I'll turn the call over to Mirko.

Good morning, everyone. This morning, we've dialed into this call from Regina, where we announced a transformational expansion of Bell AI Fabric with a 300-megawatt AI data center in Saskatchewan, our largest investment ever in the province. For 145 years, Bell's investments in communications technology have been integral to Canada's economic prosperity. Now, our vision to lead in AI infrastructure and solutions and to drive the next wave of economic growth has clear momentum. I want to frame this announcement around 3 clear points. First, it reinforces and accelerates Bell's long-term growth profile and is incremental to the financial framework we laid out at Investor Day.

Second, it materially strengthens Canada's sovereign AI capacity and AI infrastructure, supporting secure Canadian-controlled environments for governments, public institutions and enterprises. Third, this is a disciplined infrastructure investment, fully aligned with our clear strategic priorities and backed by a strong partnership with the Saskatchewan government, SaskTel, SaskPower and importantly, long-term contracted customers and contracted revenue. With this announcement, we now have line of sight to monetizing approximately 800 megawatts of power, including the 300 megawatts we're announcing today and the 73 megawatts we referenced at Investor Day back in October.

We're also very aware that a project of this scale must be diligently managed, including construction and counterparty considerations. That's exactly why we structured this investment the way we have and why we are confident in our ability to execute. Bell has a long track record of delivering large-scale complex infrastructure projects across the country, including our multiyear, multibillion-dollar fiber build-out, which we executed with discipline, rigor and a clear focus on risk management. We're approaching this project with that same mindset. Phased, contracted and grounded in capabilities we have proven repeatedly at scale. From a financial perspective, this project meaningfully improves our revenue, EBITDA and free cash flow growth while strengthening our credit profile and dividend coverage over the medium term.

What also differentiates Bell here is our ability to deliver solutions by bringing the right partners into our ecosystem. Through Bell AI Fabric, we combine infrastructure, connectivity, security, AI integration and services, working with best-in-class partners rather than trying to do everything ourselves. That partner-led integrated approach allows us to meet customer needs at scale while remaining disciplined on risk and capital. Let me start with the why. AI is rapidly becoming foundational infrastructure for governments, enterprises and research institutions, particularly in regulated data-sensitive environments.

What customers are telling us very clearly is that they don't just need access to compute, they need secure, sovereign Canadian-controlled infrastructure integrated with connectivity, security and services. That's exactly the need Bell AI Fabric was built to address. With this project, Bell is investing to build the physical infrastructure, the space, the power, cooling and connectivity required to support AI workloads at scale. We're making this investment with clear visibility to significant contracted revenue, EBITDA and free cash flow. Importantly, we are not buying chips, and we're not speculating on future technology winners or cycles.

We continue to partner with best-in-class compute providers, and we deploy capital only once we have customer commitments. This Saskatchewan facility is a clear example of the discipline we outlined last year, driving significant growth while managing risk. We've secured long-term tenant agreements with Cerebras and CoreWeave, 2 large global AI leaders with strong access to capital. They will supply and fund the compute hardware, and they will utilize the full 300 megawatts of capacity. Bell's role is the infrastructure layer, where we have a durable advantage and where returns are infra-like. We know that AI is here to stay, that it's transformational and that it will be a major input to economic growth.

At the same time, it will continually evolve. And regardless of how that evolution unfolds, AI will always require secure power, space, connectivity and sovereign infrastructure, which is exactly where Bell is positioned. A key element, as I mentioned, is sovereignty. We have the flexibility to allocate a significant amount of capacity to sovereign AI workloads, ensuring that Canadian governments, public institutions and enterprises can run advanced AI workloads under Canadian jurisdiction with data residency and data ownership and control preserved. Until these sovereign workloads materialize, our customers will be using this capacity with other offtakers. This project also reinforces what we communicated at our recent Investor Day. Bell has renewed momentum backed by a unique set of differentiated assets working together and tightly aligned to our core strengths.

Our broader AI-powered solution strategy is a great illustration of this momentum. AI Fabric does not stand alone. It complements Ateko and Bell Cyber, allowing us to participate across the AI value stack, infrastructure, security and integration, while remaining disciplined on risk. Before I hand it to John, I want to be very clear on one final point that matters, of course, to investors. This investment does not change our financial philosophy communicated at Investor Day. Today's announcement is contracted, it's phased and it's return driven. It strengthens our long-term EBITDA and free cash flow profile, and we remain laser-focused on achieving our 3.5x net debt leverage target by the end of 2027 and continuing to delever in 2028 and beyond.

John will now walk through the operating model and execution.

Thanks, Mirko. Good morning, everyone. I'll focus on what we're building, how it comes online and how risk is managed. This is a 300-megawatt purpose-built AI center located in the rural municipality of Sherwood just outside of Regina. The site was selected for power availability, scalability and redundancy. This project is made possible because of the Saskatchewan government's strong partnership and engagement. Saskatchewan wants to be at the center of AI development in Canada, and we're proud to be part of their vision. We will construct the Saskatchewan data center in phases with each phase coming online in sequence. As we've outlined in the deck, the facility is expected to come online through 2027 and be fully operational by 2027 year-end.

To support disciplined execution, we're in the midst of a competitive construction RFP process and have received bids from leading national data center construction firms. We are not self-building. We're deliberately selecting experienced partners with proven delivery track records at this scale. In parallel, we're actively managing procurement risk by placing early orders for long lead time equipment, including generators, chillers and key building materials and arranging for warehousing where appropriate. This approach is designed to reduce exposure to supply chain constraints and avoid scheduled delays. On the commercial side, Cerebras and CoreWeave are anchor tenants.

They will fully utilize this data center. They contract with Bell for long-term access to space, power and infrastructure, and they're responsible for contracting with their end customers for the majority of workloads. For the sovereign component, Bell will work with partners, including SaskTel to support Canadian public sector and enterprise demand. From a risk mitigation perspective, there are 3 things to highlight. First, construction and execution risk. Through phased deployment, modular design, competitive procurement, early ordering of long lead time equipment and strong municipal and provincial engagement, we have taken steps to limit the risk associated with construction. We're building on experience from our recent AI data center developments that were delivered using standardized, reproducible designs, repeatable processes and experienced delivery partners, which gives us confidence in our ability to execute this project as planned.

In addition, we will supplement Bell's internal teams with specialized on-site data center engineering and operations partners, reducing execution and uptime risk. Bell has been building infrastructure in Canada for 145 years. So this is a familiar path for us and one in which we'll execute as we always do. Second, counterparty and demand risk. In line with the plans we outlined at Investor Day, we have secured tenants before committing capital. This project is fully contracted with 100% of capacity already sold. Our contracts are long-term in structure to provide infrastructure-like cash flows and Bell does not take uncontracted exposure to AI utilization or AI pricing.

Our pipeline is significant, and we'll continue to see strong demand for capacity from customers and potential partners, providing optionality beyond this fully contracted project. Third, technology and obsolescence risk. Bell does not only compute hardware. Our tenants do. That materially reduces technology risks and keeps our capital focused where we earn our returns and create the most value. Finally, on community and sustainability.

The project includes commitments around local employment, indigenous economic participation through our memorandum of understanding with George Gordon First Nation and a water smart, energy-efficient design, including a closed-loop cooling system that does not draw water from municipal water sources as well as plans we're exploring around waste heat reuse with post-secondary institutions and others.

Today is an exciting day for the team behind our strategy to lead in AI-powered solutions. Our full stack AI approach from Bell AI Fabric to Bell Cyber and Ateko has clear momentum. We're looking forward to meeting our enterprise and public sector clients' needs and scaling even further. With that, I'll hand it to Curtis to walk through the financial benefits of this project and its impact on our guidance.

Thanks, John. Good morning, everyone. I'll focus on capital investment returns and how this project improves our 3-year growth profile, while we maintain our 3.5x net leverage target by the end of 2027 and moving below that level in 2028. Construction of this facility will require approximately $1.7 billion of incremental CapEx with approximately $1.3 billion expected to be incurred in 2026. This CapEx is fully reflected in the updated 2026 guidance we released this morning. The $1.7 billion total spend will be partially offset by approximately $400 million of onetime setup fees and customer prepayments in '26 and '27. From a revenue perspective, we expect revenue to begin in the second half of 2027 as the initial phases come online.

At full run rate, the Saskatchewan data center is expected to contribute approximately $500 million of revenue, $400 million of EBITDA and over $250 million of free cash flow for BCE. We've also engaged closely with the credit rating agencies on this project. They reviewed the structure, construction plan, contracted economics and risk mitigants and our current ratings and outlooks were maintained. From a returns perspective, we expect the project to deliver an IRR of approximately 20% at the data center level with additional upside potential from sovereign workloads, GPU as a service to enterprises as well as related services from Ateko and Bell Cyber.

These returns are driven by long-term contracted economics, not by assumption around AI pricing, AI utilization curves or the success of any specific AI application. Because revenue is contract-based and infrastructure like, this project does not introduce incremental earnings volatility relative to Bell's existing profile. As the Saskatchewan data center comes online in a series of 4 phases through 2027, we expect it to generate positive free cash flow in 2027 and to exit the year operating at an EBITDA run rate. Our investment will be funded through a combination of debt and cash on hand. On a run rate basis, the transaction is leverage neutral and significantly enhances our deleveraging profile over time.

Critically, this announcement does not change our capital allocation priorities. We remain committed to achieving 3.5x net debt leverage by year-end 2027 and moving below that thereafter. We're continuing to allocate funds toward our 4 strategic priorities. We will continue to pay a sustainable and attractive dividend and do not anticipate issuing common equity to fund this transaction. We've also increased our 2028 growth targets, reflecting the contribution from this project while keeping baseline capital intensity unchanged over the medium term. To be clear, the only reason for revising our guidance today is to reflect the Saskatchewan AI fabric project we announced this morning. There are no other changes to our underlying operating assumptions or outlook.

We're also increasing our objective for AI-powered solutions revenue from approximately $1.5 billion by 2028 to approximately $2 billion by 2028. In short, this is exactly the type of investment we said we would pursue at our Investor Day, infrastructure-based, contracted, disciplined, accretive to free cash flow and fully aligned with our clearly communicated strategic priority to lead an enterprise with AI-powered solutions.

Kris, let's open the line for questions.

Thanks, Curtis. [Operator Instructions] With that, Matthew, we're ready to take our first question.

[Operator Instructions] The first question is from Vince Valentini from TD Securities.

I'm going to ask a question and hopefully a clarification. Question is just if you are reserving space for -- first of all, congratulations. This is a great announcement. But the sovereign space that you're reserving, if you like max that out or reach close to your targets on that, does that take the $400 million of EBITDA up to $450 million or $500 million? Can you give us any context on what kind of upside if you're successful selling some of the capacity on a sovereign basis?

Yes. So we haven't -- so the sovereign demand will -- it's Mirko, by the way. Vince, thank you. Let me start again. So the sovereign demand will evolve over time. We've reserved more than enough. We've contracted for the ability to allocate demand or compute to sovereign demand as that evolves, and we've reserved the ability for far more than the near-term demand that we expect from sovereign workloads. And as those sovereign workloads materialize, yes, that will be over and above -- in some respects, will be over and above given the ancillary services that would come with that to the $400 million in EBITDA, but we haven't profiled that yet because that's a function of when demand comes and the exact type of demand.

Okay. And the clarification is just on the press release and material assumptions on Page 14, assumptions concerning BCE. I'm not sure I understand the 2 columns. One on the left-hand side, for 2026 assumptions, it doesn't look like interest expense or depreciation have changed from what you gave us in February. I assume there'd be a little bit of impact because of the $1.7 billion of CapEx coming in during the year that would boost interest expense. Am I reading that right that the left-hand side is '26 has not changed and the right-hand side is the '28 targets?

Yes, correct, Vince. We still assume -- you're right, firstly, there's going to be a little bit of incremental interest, but it still falls within our initial range. So we did not update that range.

Okay. So it's still -- it wasn't a big enough impact to change the ranges, but it should...

Our next question is from Maher Yaghi from Scotiabank.

I want to spend some time on the contract that you signed with CoreWeave and Cerebras. How long are these contracts? And for how much capacity will they be using?

So they've contracted for -- between the 2 of them, the full 300 megawatts are contracted over a long period of time.

How long?

Many years. Think like a decade.

I understand. Are these renewable leases or it's one full long-term lease?

Yes, the contracts are renewable and the facilities will have a long life in terms of the components that we're investing in.

Okay. So when you say it's a long-term lease, are you assuming that these, let's say, call them medium-term leases get renewed or it's multiple long-term leases?

I might have to follow up after the fact. But if I understand the question, we have 2 tenants. We've leased the entirety of the data center capacity to them over a long-term period with an ability to continue to extend those lease agreements as they come due again in the long term. But it's a lease with one tenant, a lease with the other tenant.

Okay. So if I take, for example, one of them, I don't care. It doesn't matter, but let's say, the first tranche of the first lease, would that be more or less than 5 years?

They're all long term. So it's -- maybe we're confusing things, but they're each taking 2 data halls each. And each data hall that they sign up for is a long-term lease. It's not 5 years, it's longer than that. And every data hall has the same long-term lease. I mean they're not staggered in any way. They're all long-term leases.

Okay. And is there any attached signed residual value to these contracts? Are there guarantees if the tenants stop their contracts for any reason that they pay you a residual value guarantee.

So Maher, our tenants are Cerebras and CoreWeave, as you know, they're best-of-breed. They're well capitalized with global scale. The contract structure that we have with them has clear revenue visibility, inflation protection. And so that protects the infrastructure like long-term cash flows given the long-term leases. In the -- when you're thinking from a risk mitigation perspective, the underlying infrastructure that we're building here will remain attractive to a broad universe of customers over time. So very, very fungible as AI, demand for AI continues to outstrip supply. And keep in mind, we own and develop the land here. We have the building, the power, the cooling, the connectivity. We're not taking the technology obsolescence risk on the compute hardware.

And the last thing I'll say is the agreements that we have in place with these 2 customers have all the protections you would expect that we would build in, in terms of termination rights, renewal options at regular intervals and other credit protection mechanisms. I can't get into the details of those, but you can expect that we would have negotiated all the things you'd expect. And plus, Curtis mentioned in his opening remarks, some of the prepayments that they're making right now this year and next year that further derisks the project from our perspective.

Okay. And just on -- when do you expect the 300 megawatts to be running at a stabilized run rate? And when that happens, what's the expected cap rate?

Yes. As Curtis mentioned, as we exit 2027, we'll be at full run rate on revenue generation for the full 300 megawatts.

That's quite a fast build. Can you -- did you select already the construction project manager on this project?

So Dan Rink is going to answer that one.

Yes, this is Dan. So we've got the same team developing this that we've used to develop the prior data centers, and we're already in RFP and very close to final selection with a number of GC partners that will be building the various phases of this data center.

So you expect from date of first construction phase to be full running 300 megawatts in 1 year essentially?

Correct.

Yes. Maher, I answered that one. We're going to exit 2027 at full run rate on revenue generation, which means 4 data halls built and ready for service.

This isn't new for us. We've been actively doing this in these types of time frames, at scale building out other facilities. We've got some very novel ways to modularize and do a lot of work offsite and expedite the construction.

Finally, just one last -- 300-megawatt power, is it fully contracted already?

Yes, Maher. So fully contracted with -- through the Saskatchewan government and the Crown corporations that are part of this SaskTel for fiber and SaskPower and TransGas...

12 months, just to frame it, our customers are responsible for all of the work inside the halls. So we're delivering the facility. They will need to put the racks in and wire them and get that work done. So that should give you even more confidence in terms of the time line because they're responsible for that.

Yes, that's a great point, John. So we don't do any of the white space development. So that's a significant portion of the normal time of building a data center.

Yes, that's the delta that I was trying to figure out.

Our next question is from Stephanie Price from CIBC World Markets.

It's Sam Schmidt on for Stephanie Price. I wanted to talk about ongoing CapEx needs. Are there any associated with the data center? And does it change any longer-term capital intensity assumptions?

Yes. Thanks for the question. Look, this is a brand-new facility. We have modeled in some ongoing maintenance CapEx just to make sure that the facility is always up to code and always running smoothly. No expectation that it would change our $3.7 billion capital envelope once you get past the initial build phase in 2027.

Okay. And I'll just maybe squeeze in one more around margins. $500 million in revenue, $400 million in EBITDA implies quite high margins. Is that typical of how you are thinking about the data center opportunity? And then I'll pass the line.

Yes. Again, it's -- we do think these are attractive margins. It is a brand-new building. So the cost to operate a brand-new world-class facility are -- just drive efficient margins ultimately.

And also the facility of a complex of this size, brand new complex of the size that's brand new also gives us significant operating leverage given the scale.

Our next question is from Drew McReynolds from RBC Capital Markets.

Congrats on the announcement. Very interesting to get all the details. I appreciate that. Two for me. One, I guess, maybe for you, Mirko, you have line of sight on 800 megawatts. You've announced the 300 plus the 73 previously. Just how do you see that kind of playing out over the next few years? Obviously, this is a big one to tackle, but presumably, you may be working on others or maybe not. If you can comment on that? And then secondly, just with respect to this announcement, how do you begin to size up potential incremental opportunities for the likes of Ateko or Bell Fibre?

So I'll take the first one, Drew, and John will tackle your second question. On the first one, we're going to continue to take a very disciplined approach to the rollout of Bell AI Fabric. We -- certainly for the last 18 months, we've taken an approach that we're going to provide a road map to investors in terms of our strategy, our ambition and how the priorities are going to be funded, and we're going to be very transparent in that over multiple years, and we're going just to keep checking the boxes in terms of hitting key milestones. And that's what we're doing here. We're taking a very disciplined approach in terms of how we contract, who we contract with, demand-led, contract-based and returns driven.

So that's what we decided we would do at Investor Day when we thought we had -- we knew we had kind of a line of sight to 73 megawatts monetization over the Investor Day horizon. We also have been saying more recently that the pipeline and the interest and the potential demand has been much stronger than we even anticipated back in October as we were building the plan. But again, we wouldn't change anything until we had those contracts in place. And now you see an example of a very significant data center is about to be built because of the approach that we've taken. It's going to be the largest AI data center in Canada once it's operational in a very short period of time.

So to -- what do we do with the remaining 500 megawatts? We -- there continues to be significant demand. If -- we're not going to change the guidance beyond what we're saying today, we have clear line of sight to 373 megawatts being monetized. Should the clear interest allow us to pull some of that extra demand into the Investor Day time period between now and 2028, we'll certainly look at it. But the key factors will be returns driven, very strong IRR is going to be required. We're going to need well-capitalized partners, long-term agreements, and we don't plan to deviate from our deleveraging targets of 3.5x by 2027.

And of course, if there's opportunities and we can bring in funding partners to help us in that, we certainly will look at that as well. And you've seen how we were successful in doing that in the U.S. with PSP and Ziply fiber. So we're not -- we're open to that kind of approach if it's an opportunity to pull in more demand sooner. That was a long answer, so I'll stop there, but it was an important question. Over to you, John.

Great. Thanks, Mirko. Drew, I think the way to look at it, if you had 100 companies in our position right now, 99 out of the 100 would say this is an amazing day. Let's go and celebrate. I think what's different about us and why we say we're one of one, things are just getting started here. We see the opportunity to bring AI to life for public sector organizations for private sector. The growth in sovereign, the growth in helping them with their mega platforms and their hyperscaler deployments to enable AI at scale is a massive need. And the assets we put together are really unique in terms of helping enable that.

So I think you're going to see a lot of goodness that will come over the course of this year. We have very big targets. It started with the $1.5 billion, but the unique set of assets we have, the approach we have to stimulating demand, not just providing compute and consumption. Coveo, Cohere, SAP, 3 recent announcements to run on fabric in a sovereign domain, we're seeing tremendous interest. And it's now cascading into the largest private organizations with a desire to understand more about sovereign and how they could be beneficiaries of it. So we think the future is great across the full stack and today is a beautiful foundation to help accelerate that.

Our next question is from Jerome Dubreuil from Desjardins Securities.

First one is maybe back to Vince's question, trying to understand how the sovereign AI component works a bit better. I think you said the power, the 300 megawatts is fully allocated. But at the same time, the sovereign AI allocation is on top of the $400 million EBITDA that's expected. How exactly does that work? Do you have a bigger part of the pie if it's sovereign AI than other types of business?

Jerome, it's John. The sovereign side, as I mentioned a little bit earlier, we've essentially started to create demand across the board to consume it. And the challenge is not having the compute power. The challenge is stimulating demand, building an understanding, having the ecosystem brought together of a variety of companies. So you have a meaningful capability there that customers can take advantage of.

And we've been going flat out to build that and have those capabilities that companies, public and private can take advantage of. So it's flat out on that domain. And the compute is not the challenge. It's creating demand across the landscape. And I can tell you, it's coming now. The conversations and activities, it's really gaining momentum across the board. So we're really hopeful. But today, it's nascent. But I think by the end of this year, you're going to see some really good things in this domain.

And then Jerome, it's Mirko. Just the point I was trying to convey in my conversation with Vince was on the sovereign side, there's, of course, the sovereign workloads, just like non-sovereign workloads. But with sovereign, there will come managed services, not just workloads. That's the part I was trying to convey would be incremental to the business case.

Makes sense. That's good to see we're able to carve out a bigger part if you bring more value. The other one I have, just a clarification. I'm looking at the run rate free cash that you're expecting to be [ $250 ] million. I'm looking at the updated 2028 guidance, and I don't see it quite being fully reflected there unless my calculation is wrong. So maybe you can reconcile what's not completed at the beginning of 2028 since you said the EBITDA run rate is achieved at the end of 2027, maybe there's more building cost in '28 or something.

Jerome, it's Curtis. No, your math is not wrong. Revenue and EBITDA exit 2027 at a run rate level. but free cash flow takes a little bit longer to reach run rate level. So still very strong free cash flow in '28, '29, but has not yet hit run rate simply because there's an amortization period of the prepayments we received in '26, '27.

Our next question is from Sebastiano Petti from JPMorgan.

I guess, Curtis, just following up on that last point. Is it $400 million in upfront payments in each year, '26 and 2027? Is that correct?

Total across. So I think $1.7 billion spend less $400 million kind of refunds and prepayments gets you to $1.3 billion net capital at risk.

Got it. Okay. That's the point -- over the build period through 2027. Got it. Okay. And then as we think about additional opportunities, and you guys have cited the 500 megawatts since the Analyst Day, but you now have this new facility coming online here. As we think about it, is this a one-off unicorn in terms of the AI data center opportunity in Canada? Or could you see additional opportunities evolving perhaps in different provinces, right, that you could perhaps see additional facility demand like this kind of popping up? Just as we kind of think about Bell's positioning and the multiyear opportunity, could something like this pop up incrementally between now and your 2028 guidance? Just trying to think about the demand or the conversations you're having from some of the end consumers.

Yes. So there's 500 additional megawatts of capacity that we'll be looking to monetize over time. As I mentioned to Drew, if we can pull that in, we will under the parameters I've already mentioned, I won't repeat them. So -- and the demand is very strong. The 500 megawatts could be monetized -- will be monetized, I should say, over time. And it will be a mix of large data centers and smaller ones like we already launched last June in Mission Flats BC at 7 megawatts. So it will be a combination, a mix of the mega scale like the one we announced today, the smaller ones and everything in between.

In fact, we made a public announcement a few months ago that we have an MOU with Queen's University to monetize -- to build them a 40-megawatt data center. That's going to be dependent on Queen's University obtaining some funding. But if they do, they'll be paying commercial rates, but that gives you a sense of something between the 7 megawatts in Mission Flats and the 300 megawatts in Saskatchewan.

So it's that type of mix that we're talking about. The demand is very strong. And again, we're sitting here in a nice position at the intersection of AI demand, network, security, AI integration and in many cases, the sovereignty upside. So it's a great position to be in. And we've got those ancillary services, as John mentioned, that's going to create that flywheel of AI industrialization in Canada. So we're really excited about it.

Our next question is from Aravinda Galappatthige from Canaccord Genuity.

On the announcement and the work so far. With respect to Mirko, the remaining 500 megawatts that you plan on monetizing, should we think of sort of the associated capital expenditure to be sort of proportionate to sort of the announcement today? And secondly, maybe a quick question for Curtis. Given the comments you made about when you hit $400 million in EBITDA run rate at the end of '27, but the lag in free cash flow, should we think of this sort of being either neutral for 2027 or perhaps slightly dilutive to free cash flow in 2027?

Well, I'll take the first one. I should clarify as we've been having the exchanges and we're talking about the 500, let me just -- just because I want to be clear on the fact. So we have a total of 800 megawatts that we have a line of sight to that we can -- that we seek to monetize. And in our guidance, we -- through to 2028, we've now kind of factored in monetization of 373 megawatts. So what's left to be monetized is 800 minus 373. I know we've taken shorthand here on the call saying 500 left to be monetized. In terms of the profiling of kind of the revenue generation and the cost to build, the remaining megawatts that we can monetize. It's going to -- it's hard to answer that now, Aravinda, because it's going to depend on the mix of small, mid and large data centers.

When you have a large data center like the one we announced today, typically, your tenants are expecting a little bit of a better rate. On the other hand, you get way more operating leverage as you build greenfield, something this size. So you can see that in the flow-through as we discussed in response to an earlier question. And so the economics kind of vary a little bit depending on -- in terms of revenue and the flow-through and the capital cost depending on the size of the data centers, greenfield versus retrofit, et cetera. So it's hard to answer right now.

And then just on -- to follow up on that and then to get to your second question, Aravinda. So just to be clear, the 73 megawatts, the CapEx required to monetize that opportunity is baked into our capital envelope over the next 3 years. And importantly, we've said it a few times, but it bears repeating. We're only going to spend the CapEx once we have line of sight contracts into the actual revenue. So it's a different risk profile of CapEx spend. And ultimately, in the EBITDA side of the world, so yes, we'll be exiting 2027 at run rate revenue and EBITDA, but we're actually driving free cash flow accretion in 2027. So the last part of your question was free cash flow, but free cash flow in 2027 is going to be positive.

There are no further questions registered at this time. I would now like to turn the meeting over to Mr. Somers.

Matthew. And thank you, everyone, for your participation on the call this morning. Richard and I will be available throughout the day for follow-up questions or clarifications. Thanks, and have a great day.

Thanks, everyone.

Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.

Okay. I'm Ben Swinburne, Morgan Stanley's telecom and media analyst. Quick disclosures. For important disclosures, please see the Morgan Stanley research disclosure website at morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales rep.

And we are excited, I think, to welcome to the conference, I believe, for the first time, Mirko Bibic, who has served as President and CEO of Bell and Bell Canada since January of 2020. Mirko, thanks for being here.

Thank you, Ben. Glad to be here.

So you had an Investor Day, as you know, back in October, laid out a long-term vision for the company, a 3-year strategic plan. Revenue growth of 2% to 4%, adjusted EBITDA of 2% to 3% through '28. Why don't we start, level set for the audience sort of the key pillars underpinning that growth outlook for the business?

Yes. So thanks for the question. Throughout the course of 2025 last year, we really set about kind of outlining with clarity a forward-looking capital markets and operational strategy. Obviously, they work hand in glove. And you've now got before you a BC and the Bell Canada, essentially a renewed energy, renewed vigor, a lot of optimism around the plan. And I think from an investor point of view, what I'd really highlight is, as a management team, we've declared ourselves, like we've outlined what we are going to do over the next 3 years. And so now we've got a management team that's focused entirely on execution, execution, execution against that plan. We're not managing to yesterday or to this quarter necessarily, we're managing to 2026, '27 and '28.

And the plan is built around we call 4 plus 1, so the 4 strategic priorities, which are putting the customer first, delivering the best fiber and wireless networks, leading an enterprise with AI-powered solutions. And on the media side, it's about building a digital media and content powerhouse. So they all work together in a very tight integrated way. And it's all supported by the plus 1, which is a pretty aggressive cost reduction agenda. But importantly, it's about reducing costs while at the same time, improving customer experiences. So that's the plan.

Great. We'll dive into all those 4 plus 1 as we go through the conversation. Why don't we talk -- start with the consumer and SMB segment. So this is where you're targeting, I think, 4% to 5% compound growth in your sort of growth services over the next 3 years. It's still a very competitive environment in Canada. I don't need to tell you that on the telecom side. What are the things that you guys are doing specifically to help drive this accelerating growth from what we've been seeing over the last couple of years?

Right. So I'm glad you highlighted that on the consumer and SMB side, we've basically -- and we've done this for enterprise as well as we've outlined for investors -- we've shaped for them the profiling of saying, look, we are leaning into the growth vectors and those are going to grow. And in the case of consumer, you just mentioned there at 4% to 5%. And we've unpacked for investors the fact that we also -- we're a 145-year-old company that has a number of legacy businesses that are in structural decline. So we've separated the declining legacy businesses from the growth assets.

But on the consumer side, fiber and wireless, the way we're going to do it is really 3 key pillars, and it's all about execution again, churn and retention, so continue to get churn down in wireless and fiber Internet, product intensity. We recognized a couple of years ago that we've got a ways to go to match our peers and the number of households in our footprint that buy more than one product from us. And there's no reason why we can't get that up because we have the best fiber networks and leading wireless networks.

And the third thing we're going to do in order to get to those growth numbers is over-index our customer loadings on the premium Bell brand. So churn reduction, product intensity. So it's about mobility, Internet and content sales combined to as many households as possible, as many as possible on the premium Bell brand because that's where the highest value customers sit.

Great. We're going to unpack that more in a bit. I wanted to just stick with some of the big headlines from your Investor Day. So you guys put out a specific dollar number tied to AI, which is $1.5 billion of AI-powered solutions revenues over the next 3 years. So unpack that for us because I don't think too many people sort of think of Bell Canada as maybe a way to get exposure to AI.

It is -- we have -- there's a lot of momentum there behind the AI vector for us, and we're very optimistic about it. I think the punchline here is that you'll see that we are creating a significant amount of value in a short period of time. And the advantage we have is we essentially sit at the -- and we're comfortably sitting, I'd say, or confidently sitting at the intersection of secure networks trust because Bell is the most trusted communications brand in the country, distribution relationships and AI infrastructure. And you add to that, that we have access to a significant amount of power and time to compute is a significant advantage.

So all those ingredients together are going to lead to us executing against that vision that I said about leading an enterprise with AI-powered solutions. And it's around, again, the AI infrastructure, which is Bell AI Fabric, AI-powered cybersecurity as a service, which is Bell Cyber, and then systems integration with a specialization in automation and AI, which Ateko. And put them all together, we're going to -- we're offering the full stack AI solutions to customers.

Great. I think the last sort of big piece of the growth outlook stems from your Ziply acquisition last year. You spent CAD 5 billion last August to acquire Ziply Fiber. We have a lot of your competitors at the conference on the U.S. side here. That really expanded your fiber footprint pretty meaningfully. How is the integration progressing? What are your expectations for Ziply's contribution to growth for Bell?

So those were the contribution -- Ziply's contributions to growth were outlined at Investor Day. But really, what I'd say is when you asked the question around integration of Ziply, and it's not an integration story in the classic M&A approach where you acquire a company and then you integrate it operationally and you drive synergies. So that's not what we're doing here. I view the integration question more as the approach is to build a durable high-growth fiber platform that's going to continue to contribute meaningfully to BCE's overall revenue and EBITDA growth.

And again, fiber is the winning broadband technology. We are a fiber-first company, and we've turned ourselves into a fiber-first company in Canada, and it's really about securing growth in the United States through fiber, and it's about deploying capital to the highest value areas. So we want to continue to be in fiber. and we want to continue to allocate our fiber CapEx dollars to high-growth markets, and the U.S. is a significant growth market for BCE through Ziply.

Yes. In many ways, I'm sure you would agree last year, we saw the Canadian telecom market, while still competitive, begin to show some signs of stability, whereas in the U.S., sort of following Canada over the last couple of years, getting more intense, particularly on the cable side. I guess the question is, has the increased promotional intensity from the cable operators who are Ziply's primary competitors impacted at all, how you see that business performing in the near term?

We continue to see it growing at a fairly impressive clip. And the reason is there are 3 keys to that growth. One is having the superior network, which clearly fiber is, and that's what Ziply is a fiber company. Two is customer experience. You got to deliver what customers expect and Ziply is second to none in the U.S., frankly, on customer experience scores, you look at churn and particularly NPS. And then the third key thing is pricing. And Ziply actually has always been priced despite the superior network and superior experiences, priced below cable, and that remains the case. So those 3 ingredients are the winning ingredients, and they still are in Ziply's favor, the network, the experiences and the pricing.

Okay. All right. Why don't we turn to the Canadian market. Obviously, the bulk of the business. It's been intensely competitive, Quebecor being, in particular, a disruptive fourth challenger over the last several years. How would you describe the landscape today? And how do you see that evolving over the course of the year?

So I think the market -- on either the wireline -- both wireline and the wireless side, I think it has -- feels certainly more -- there's more stability there than there has been in the recent past in the last 2, 3 years. So that's a good sign. Black Friday in November of 2025 was particularly encouraging. I think the first half of December last year as well. I think there has been a lot of chatter about pricing in January and February, which I would view, I think, over the medium term -- over the course of a full year, I view January and February as more of a temporary thing. I think -- but that all being said, the most important thing from -- as people assess Bell is we now -- let's go back to the first -- my first answer to your first question. We have a plan. Everyone knows what the plan is. We're executing against the plan. We're not managing the business to January or February. We're managing it over the course of a full year, and we guided to a 3-year performance target.

So that's what we are going to do. And in our case, again, I'm repeating myself, but it's fundamentally important. We've got a management team that's focused on reducing churn, increasing product intensity and going after the highest value customers on the premium Bell brand. So we are not about chasing headline, net add numbers. We are about discipline, returns and putting our efforts towards the highest value areas, and that's what we're going to continue to do. And I shared this stat a lot, Ben. I just -- again, just to put some data behind what my words. Last year, in Q1, Bell was fourth out of 4 players in wireless across almost all metrics. When you look at our performance in wireless over the course of 2025, we led the industry in gross wireless sales. In terms of the big 3, we're essentially tied in net adds, and we performed really well in terms of our churn reduction expectations and a number of other financial and key KPIs. And that's because we set out to manage our business across 12 months, 24 months, 36 months, and we're going to continue to do exactly that.

You mentioned January and February chatter. I mean these are relatively small months when it comes to the year. But is your expectation that, that's -- I don't know, just chatter and noise or that you think it moderates here in March? Or what do you think?

I do think it moderates over the course of the year. Q1 is structurally always a low volume quarter. And we have a lower growth environment generally, particularly because of the changes in immigration policy from 1.5 years ago. And again, back to our plan, we built our plan, which we unveiled in October of last year at Investor Day. We actually built our plan in a low-growth environment for a low-growth environment. So we're well -- kind of we're well positioned to operate in that framework. And as things stabilize and improve, it's all upside.

I was going to actually ask you about the immigration trends next. We have the same issue in the U.S. lately. Is there any line of sight to maybe some improvement in the immigration backdrop in Canada as you look out?

Well, in the very short term, I'd say no. I mean, the policy is what the policy is. However, in -- if you look out in the medium term, I think Canada is a country that thrives on immigration, and we need the growth. So I fully expect that to come back. In the meantime, though, you've got some newcomer growth, obviously, just not as high as it was 3 years ago. We're going to have penetration growth. Canada always lags -- has always lagged the U.S. in penetration. And as the U.S. as penetration improves, so does Canada, albeit just we're -- there's a lag there. So that's going to continue. And idiosyncratically for Bell, we've got our churn reduction agenda, and we've got our product intensity agenda, and we've got our market share ambitions on the premium Bell brand. And so we're going to continue to execute against those 3 things. So net-net, as things stabilize, I think we're going to be able to deliver on our 2026 objectives and our longer-term 2028 objectives.

When do you expect to return to positive wireless service revenue growth? What do you think needs to happen for that inflection to take place?

So I won't call a specific quarter on that. I think the focus ought to be on service revenues, frankly. It's how we're going to continue to grow the platform. So the things that we really need to see are price stabilization, which I think, by and large, I feel more comfortable about that than I did it certainly a year and 2 years ago. We need to see new win, new acquisition pricing improve vis-a-vis the same period of time a year ago. We definitely saw that in November of 2025 compared to November 2024. We saw that in the first half of December last year. It's kind of -- January, February has been up and down in terms of comparing new win pricing to a year ago. So that will be the second key thing that we need to look for.

And the third thing is promotions. Promotions are a fact of a competitive environment. You just don't want promotions to be so constant that they become kind of a baseline feature rather than truly promotions at particular times of the year. So those are the key ingredients, but I won't call a specific quarter. I would say that our objective though is to continue to stabilize service revenue, which we're starting to see. And then once you get to stabilization improvement.

Maybe not as popular as the AI question this week, but we have had a lot of discussion on direct-to-sell, satellite connectivity. What is your view of the opportunity set for Bell or even maybe if that could be a competitive dynamic as you look out ahead at more and more satellite connectivity to wireless?

Yes. We're quite excited about the opportunity we're going to have in the direct-to-sell space. We have a partnership, a privileged partnership with ASTS, and we're tied to them certainly commercially and strategically. Our objective is to have a market trial by -- in the latter half of this year so that we can launch -- have a full market launch very early in 2027. And so the bundles, the plans, the pricing, the promotion, all of that is TBD in terms of how we're going to approach the market. But we believe that our offering through ASTS is going to be superior to what our competitors offer in the direct-to-sell space. And it will improve the customer experience and certainly will, as a result, improve our churn performance and I think will lead to, over time, a market share shift.

How do you think about the market opportunity? Is this something that a lot of your wireless customers will pay for, even if it's maybe as a backup or just peace of mind? What do you think the market opportunity is for direct-to-sell?

I mean we -- I won't go so far in the early days as to size the total market opportunity, but I do believe there's demand for the service. So I definitely see it being included in the highest value wireless plans, again, to generate higher service revenue and to lower churn. And if we make it easy to subscribe to, that's the key thing, right? Just make it easy for customers. I think there's going to be important demand there on a pay-per-use either on a pay-per-use basis or just subscription on demand. So if you're all of a sudden out of coverage, if we send you an alert, you're out of coverage, click here, 1 click, 2 clicks and you can have instant coverage. I think the key determinant to kind of the key driver to the market potential is going to be how easy we make it for customers to subscribe.

Okay. Let's talk a little bit about the enterprise space. What do you see -- when you look at cyber, Bell Cyber, Ateko, what differentiates these businesses in the marketplace and allows you to grow?

So it is -- we are extremely -- we're pretty proud and excited about what we're doing in the enterprise space compared to, frankly, most legacy telcos in this space. Our -- even before these growth vectors, our -- the way we were managing the core business in terms of very modest declines where in most countries, you see the legacy telco have significant enterprise declines. So just there in the core business, turning modest decline to stability and slight growth is a huge accomplishment. And now you add to that these high-growth verticals.

And again, the secret here is combining -- finding growth verticals that are tightly tied to the core expertise. So that's a massive differentiator. Whether or not you're talking about Ateko or Cyber or Bell AI Fabric, they are very closely tied to the core business of communication and connectivity. So that's one important thing. Two is the Bell's strength in Canada in distribution is second to none. And we have a significant advantage compared to anyone else on distribution in the enterprise space and the trusted Bell brand. And you look at Bell AI Fabric, for example, it really is combining, secure high-performing networks, which are our core business with our distribution, the trusted Bell brand and now you add AI infrastructure to that. It's a powerful, very potent and powerful combination. And we're approaching this entire growth -- these growth verticals in a very disciplined way. And by that, I mean it's demand led.

So once we have the demand, so a committed customer, we will build a data center -- AI data center for them. So that is a key thing. High growth, low risk from that perspective. We're not speculating on a data center build and hoping customers will come. And the second thing we do is we are not ourselves investing in GPUs. We partner with those who bring GPUs to the data centers. And in many cases, the GPU owners are actually the key committed tenants for our fabric -- AI fabric facilities, all of which to say is we don't take the technology obsolescence risk. And so high growth, disciplined way, high growth secured in a disciplined way. Lots of potential there.

Got it. Great. Let's make sure we touch on Bell Media. I can't leave that out right now. You guys are talking about driving digital revenue from 45% of revenue last year to 60% by 2028. I don't know how many people here know about Crave. They all know about Heated Rivalry though. So maybe you could talk a little bit about -- and congratulations, by the way, on that show. Talk a little bit about how you have positioned your streaming businesses in the marketplace relative to all the other options that consumers have today?

So we have -- we're also pretty excited and energized by the growth potential of Bell Media. And for those who don't know, we are the largest broadcaster in Canada and have either been a majority owner or an owner or 100% owner of what is now Bell Media since 2000. So I mean, I don't think it's appreciated that the media business is actually a core business of Bell's. And we're not immune to the worldwide forces that have impacted legacy media over decades. But we just haven't sat there and let it continue to decline. We took an approach 5 years ago that we were going to change this business back to growth by leaning exclusively into digital.

So the strategy is premium entertainment, which is Crave streaming; premium sports, which is TSN and news, which is CTV News, all 3 of those, so entertainment, sports, news on digital platforms. That's the play. And so we've been aggressively pivoting the revenue mix towards digital since 2020. It's working really well. So let's go to Crave now as the proof point. We grew the Crave subscription base by over 1 million subscribers in 2025 year-over-year and across we've looked back to any one of our products on the media side, on the telco side, years and years, decades. And it actually was Crave in 2025 was the fastest-growing Bell product that we can remember. Of course, we have far more wireless sales than we do Crave sales, but on a net add basis, it was phenomenal.

And it's on the strength of premium entertainment, including a lot of Canadian content, which is very popular in Canada, as you'd expect. on a digital platform that keeps improving. And it's pretty remarkable to think that probably the hottest show in the last 6 months globally is a Bell Media Crave content, Heated Rivalry. We're really proud of the show, but it's not the only one. We had Shoresy and Letterkenny. We have a lot of French language content on Crave that have sold globally. One of our shows, French language shows that was very popular in Quebec, ended up being #1 in France as well most recently. So it's got some momentum.

Is there a Heated Rivalry future film or a spin-off you want to announce?

That's probably leave that to the experts rather than me. There is a season 2, though.

Yes. Sure. Nice. Okay. I want to make sure we talk a little bit about the regulatory environment, TPIA. So let's start with that. The CRTC's decision on wholesale has been controversial, I don't need to tell you that. The final decision mandated that you will provide wholesale access to your facilities. I know that was upholding a prior decision. How is that impacting your capital allocation plans, if at all?

Oh, it is. So I'd say we react -- I'm going to keep back to a common theme, right? We just kind of go back to -- we anchor ourselves all the time to our plan. And our plan includes on the capital markets side, our capital market strategy, disciplined capital allocation, investment dollars find their own level. So we react to the signals around us. What we are going to continue to do is direct our investment dollars to the highest return opportunities in areas that are tightly connected or singularly connected, frankly, to our plan.

So the -- an important signal was sent with that public policy change. And that is that there is going to be lower returns on future fiber build than there had been on previous fiber build. We're still going to build fiber in Canada, although at a significantly lower pace than we had before. Some of those fiber dollars got reallocated to the U.S. that are higher growth opportunities and still more capital investment got directed to more capital-light areas that are higher growth like AI fabric, some of the digital media areas. So it's kind of the decision highlights the importance of revenue diversification and geographic diversification. So it's kind of back to the same point. We've got geographic diversification in our core business with Ziply, and we've got revenue diversification, particularly with our push in the AI-powered solutions.

You guys, I believe, did announce plans to launch Internet service in British Columbia and Alberta through wholesale. So I'm sure you've thought about the competitive response and gamed it all out. Why is this an attractive opportunity for Bell shareholders?

Yes, we'll be very disciplined. So we do not intend to use TPIA in the West to become a mass market Internet provider. It's actually -- I'm repeating myself, but it's really kind of -- I hope I'm demonstrating the focus. It's the same plan out West, which is multiproduct bundling on the Bell brand. So we're only going to offer Bell branded services out West, and it's not about being a solo Internet provider. It's frankly using TPIA to improve lower churn, improve churn in the West for our high-value wireless base. What we want to do is we want to protect the high-value wireless base that we have, and we want to grow the high value -- our high-value wireless market share out West.

And we're going to do that for those customers who want multiple products. We're going to use TPIA as one lever, and we're going to use our streaming content bundles as a third lever. Taking a step back, what are we trying to do, increase our -- protect our wireless base to increase our high-value wireless market share on the premium Bell brand through churn reduction and product intensity. It's actually the same plan as it is across the board in Canada for Bell, and it's a very disciplined approach. So we don't plan on aggressively pricing solo Internet to gain Internet market share in its own right. That's not the play.

Okay. Let me ask you another one, and then we'll see if anybody in the audience has a question for you. One of the things we've heard about over the course of the last year or so on the AI front is data sovereignty. And I wanted to ask you how you think the Canadian government and the Canadian marketplace thinks about that and whether that is a tailwind to what you're looking at achieving on the AI front at Bell?

Yes, it's a big opportunity for us. The kind of the the data sovereignty mindset that exists in Canada, but in other jurisdictions around the world. And if data sovereignty is important to you and in the public sector, it clearly is and for some critical industries in Canada that -- who's operators within other critical industries in Canada are big customers of ours. So if you're the public sector or an operator in another critical industry and data sovereignty becomes an important thing. Again, it comes back to security of networks, trusted brands. So we're in a good spot there given our high-performing networks and our trusted brand.

So I think it's a potential further accelerant to our AI-powered solutions ambition. The growth projections that we have and that we outlined at Investor Day for AI-powered solutions, the $1.5 billion in revenue, none of that is necessarily dependent on data sovereignty as a critical enabler, but it is a big opportunity that would be a further accelerant to the growth plan.

Okay. That makes sense. Any questions? [indiscernible] just wait quickly for the microphones to the webcast can pick it up.

As you talk about the Ziply opportunity, how should we think about other M&A potential outside of Canada? And how big do you think the fiber opportunity in the U.S. could be?

So our fiber opportunity, we've outlined it on Investor Day. We aim to get over the longer term to 8 million fiber locations passed 3 million of those by the end of 2028, and we're roughly halfway there today. And so those -- that's the ambition. Again, we've declared ourselves. That's the ambition. The base case to get to those thresholds is to build. And so that's the base case. We're going to build our way to 3 million, and we're going to build our way to 8 million over time. If there are opportunities, again, over time that are opportunistic, the right value and that allow us to get to those targets quicker. We'll take a look at those opportunities.

But again, I'll reiterate 2 things. base case is to build. And two, we wouldn't do anything in the short term that deviates us from our leverage targets. We plan on getting to 3.5 -- leverage ratio of 3.5 by the end of 2027. We're going to be below 3.5 by the end of 2028, and we're going to march our way towards 3.0 by 2030. So anything we do, whether or not it's in the U.S. or in any other of our businesses, we're not going to make investments that cause us to deviate from those leverage ratios.

That was going to be my next question, you sort of touched on it, how would, if at all, asset sales play into getting down to that 3x by 2030?

Yes. And again, it's a plan we outlined last year. In this case, in terms of asset sales, we outlined our objectives in February of '25, where we indicated that we plan to monetize up to, I guess, I think it was $7 billion of asset sales, $4.7 billion of which or $4.6 billion of which was MLSE, and then we had the Northwestel acquisition. Since then, we've smaller disposition -- Northwestel disposition. And since then, we've had a smaller disposition of Bell Smart Home. And we're not at the $7 billion in proceeds yet, but the plan remains exactly as it was outlined a year ago. And I think the target was to reach those proceeds of sale by the end of 2027. So we're not deviating from that plan. So all the things we said we were going to do last year, we're going to continue to execute towards.

Great. Well, we're running out of time, Mirko, anything you want to wrap up with before we close it out?

Again, it's -- I'm going to -- repetition. It's very important when you're the CEO, you got to keep saying the same things and just to reinforce the plan. It's execution, execution, execution. I think the significant value is going to be created through AI fabric. Bell Media will deliver annual revenue and EBITDA growth, and it's an asset that generates significant free cash flow. We will hit the leverage targets that we outlined. In fact, executive compensation depends on hitting those targets. So that's just -- I don't -- I share that with all of you just to say that it is a very serious target that we won't deviate from. And we are going to continue to operate in a disciplined manner to deliver the total shareholder return that we indicated we would deliver to everybody through to the end of 2028.

Great. Thank you very much. Thanks, everybody.

Thank you.

Good morning, everyone. Thanks for joining us. I'm Lauren Bonham, and I cover Canadian and U.S. Telco along with Kannan. Next up, we're very pleased to have Curtis Millen, CFO of BCE with us. Look out to some questions at the end, so you should be able to submit them through the chat box on your screen or feel free to e-mail me as well. Thank you for joining us, Curtis.

Lauren, thanks for having us. Appreciate -- a virtual event, so I appreciate the team having to pivot.

Yes, thank you for accommodating and for everyone who's joined as well. It's been hectic a couple of days.

Just to start broadly, going into the new year, what looks different or similar from a competitive or organizational standpoint? And how have your priorities changed compared to last year, if at all?

Yes. Lauren, I'd say the priorities remain the same. We outlined them at our Investor Day, so it's balanced capital allocation, strengthen the balance sheet, delever while we fund strategic growth opportunities that's putting the customer first. So it's continued digital transformation, leveraging AI, basically improving customer experience. Funding our networks. Again, we are an infrastructure company, so funding our best networks through world class on the wireline side and on the wireless side. Continue to drive AI-powered solutions. So that's AI Fabric, it's Bell Cyber, and it's the kind of MSPS layer to services also and then continue to drive digital media.

So the strategy remains the same. Obviously, there's an overlay of just drive efficiencies in the business. So strategy remains the same. This is a year of continue to execute and continue to drive progress on our 3-year financial targets.

And 1Q is typically a quiet period for wireless loading. There's been a bit more promotional activity in January and February than maybe we would have expected. Could you talk a little bit about any changes in the wireless landscape in the past few weeks since earnings? I know it hasn't been very long, but what you're seeing so far in 2026, any change in the strategy on how you respond to that?

No, no change in the strategy. Again, it's a competitive marketplace. And since the history of the wireless industry and our industry prices become more competitive in certain periods of time. And then as you said, Q1 is generally a lower volume, it is a lower volume. So if you had to be a little bit more competitive on price, it's better to be more competitive in a world where you don't have that much volume. I think we saw some pretty good market behavior last year, right? I mean, back-to-school was pretty muted in a way, still competitive, but muted in terms of pricing actions. And then end of the year, got a little bit more competitive in a couple of weeks here in January. But again, we tend to focus on long-term value of customers. So both acquisition and maintaining the longer-term value -- higher-value subs.

So subs that are on our Bell brand, subs that are taking our fiber product, right? Fiber loads continue to be very strong. And then, of course, in a bundled world where we continue to reduce churn, bundled subs are important for us going forward also. So no real change. There are going to be blips in terms of competitive intensity. But as long as we continue to execute our plan and think about driving the best value for customers, we're going to be just fine.

Bell seem to outperform on churn improvement in 4Q. What is driving improved retention? And how much of that is coming from higher hardware upgrades versus other initiatives?

Yes. Hardware upgrades were actually down year-over-year in Q4, and our churn improved 17 bps. And I'd say that's the third quarter in a row of churn improvement. So it's many, many things, but fundamentally, it's providing great network, great service and just improving the customer experience, right, from all the way along the customer experience, we have to be very good. So it's not enough to deliver a high-quality network and a high-quality product. The entire end-to-end experience has to be good. And we spent a lot of time and energy over last 3, 4, 5 years, fixing our IT systems, updating our IT systems, so that how we present ourselves to the customer is much more digital focused.

And even more importantly, we meet customers where they want to interact with us. So whether it's self-serve, whether it's digital, whether it's call center leveraging AI capabilities. However they want to interact with us, we have capabilities kind of on an omnichannel basis now, and that will continue to improve. And I think you're seeing that bear fruit even in a world where hardware upgrades weren't the driving force. So we're quite pleased with that. And again, without customers, the machine here doesn't work. So we're focused on driving customer experience.

Going a bit bigger picture. We've seen some big changes in the industry in the past few years. Structurally, where do you expect the industry growth to settle once all the near-term noise with respect to immigration the economy, travel and so on settles down? Are we now in an environment where our longer-term core telecom growth is more in the low single-digit range for the industry as a whole?

You're probably right. I don't see anything to disapprove that, but I do think you're seeing a few tailwinds ultimately, as you look beyond just the day-to-day, week-to-week. So penetration increase, I mean, we're for, frankly, unknown reasons, we tend to be trailing the U.S. in terms of overall penetration of wireless handsets. So we'll continue to see an uptick in penetration. Immigration and new to category is still a net positive. Not the same, obviously, size of net tailwind that we've had a few years ago, but that will continue to be a net positive. And then ultimately, as we get through our ARPU reprice, there's probably a little bit of ARPU benefit here as we look out 2, 3, 4 years. Again, as we don't focus on day-to-day, week-to-week, it's -- there's growth from all 3 of those.

And then I continue to say I think we have an endemic ability to actually improve our churn, which is a relative benefit for us versus our competitors. I think there's more room for us to continue to drive churn, which, again, will help our nets going forward. And then the other thing I'd say, Lauren, Canada is a little bit more converged than the U.S., but I do think fiber becomes more and more the first purchasing decision. And we have so much fiber north of 8 million fiber locations. And when we sell a new Internet -- fiber Internet, it pulls along 40% or pulls along mobility 40% of the time. So I think we're in a pretty good structural position here to drive some outside growth over again 2-, 3-, 4-year period.

And yes, sort of sticking with that, I guess, switching to broadband. In Canada, you sold your fiber build and now seeing a lot more competition from [indiscernible] fixed wireless. But your fiber footprint is still the largest in Canada. How much more room is there for you to drive penetration within the fiber footprint? And what are the key drivers of that fiber take rate?

Yes. I'd say there are a few drivers of growth. So one, we are continuing to build fiber in Canada. So it's a couple of hundred thousand a year, whether that's new builds, new construction starts. Obviously, we're going to build fiber fits in our footprint. There's some subsidy builds, there's some edge out. So we'll continue to build fiber in Canada. And then I'd say on the penetration point that you made directly, we built 3 million fiber locations over the last 5 years, those are not -- definitely not at a run rate penetration. Like where we have more tenured fiber footprint, we're 50%, even north of 50%. So there's still some kind of inherent growth left in that newer footprint. And again, as we continue to prove out fiber is just superior product to cable, it will just continue to grow. I mean there's no reason in my mind where 50% is the actual equilibrium. It's not just Canada, I'm not just drinking the blue Kool-Aid Fiber beats cable in just about every jurisdiction. So I think there are a few tailwinds for us there.

Fixed wireless scaled pretty quickly in the U.S., it's been much smaller in Canada, there's some differences in network capacity, but your copper footprint in areas where you don't have fiber. You see some churn due to fixed wireless coming in there. Can you talk about how Bell uses fixed wireless? And is there room for a bigger push in those areas to capture copper churn?

Yes, I'd say it's a different landscape. So we actually built out 1.1 million fixed wireless homes before the U.S. really made their push into fixed wireless. But because we've built out over 8 million fiber locations, it's more of a niche product because it's not really competitive relative to fiber. And I think what you've seen in the U.S., the future fiber builders have built out fixed wireless kind of to gain a little bit of market share and gain some customers then overbuild with fiber. But ultimately, they're taking share from cable. They weren't taking share if they happened to be a fiber overbuilder. So it has a place for us, but it's certainly not competitive with fiber. So I'd say, again, in rural, where we have it, useful. It's useful where you have copper only, but it's really not going to hunt in markets where you have fiber.

And we're slowly, hopefully emerging from a tough couple of years of wireless pricing. On TPIA, we're still waiting for final wholesale rates. But assuming they remain as is, what prevents a similar sort of bout of pricing competition in wireline, given higher competition nationwide and a bigger focus on convergence and bundling?

Yes. It's a fair question. It's a bit of a different story though. I mean, ultimately, we've built out fiber. And historically, the government has supported facilities-based operators. So they want -- and look, they're in a tough spot. They want to promote competition, promote access to solid Internet. We've built out fiber. So there is a lot of access to world-class broadband. And they want to make sure that there's an incentive to continue to build. So I appreciate they're in a tough spot. But ultimately, we have the owner economics, and we have the ability to bundle with other services. So you start looking at a world where we have fiber. We'll sell wireless. We'll sell Crave, TSN RDS direct-to-consumer. And so I do think there's a world for us to continue to drive growth and leverage our footprint.

Yes. And sort of sticking on that theme, with the new administration, have you seen anything that would indicate sort of a change in course on Canada's approach to wholesale regulations, maybe moving back to how it was prior to the past couple of years. And if there was something -- if that was something that was possible, what would it take for Bell to sort of reaccelerate its domestic build plan back to its prior like $9 million target? And how could that fit into the capital allocation framework given leverage targets and U.S. build?

Yes. I think the last thing you said is very important. Obviously, we have a capital intensity envelope and we have a leverage target. So those are very important to us. We're not going to deviate from those. So for us, it's ultimately capital allocation. And on the highest level, we're deleveraging, strengthening the balance sheet, paying out a dividend and funding growth is our kind of second priority. And between that, it's just a matter of what drives the best return, what drives the best free cash flow growth because ultimately, free cash flow growth is what allows us to continue to delever and fund dividends. So it really comes down to what is the best opportunity. And whether that's fiber in Canada, fiber in the U.S., continued digital transformation or AI fabric. All of those are very attractive returns. It's a nice problem to have to have more opportunity than you can actually fund. So if that's our biggest problem, it's pretty good news for us.

Makes sense. So shifting to Ziply then. Why does investing in the U.S. makes sense? The U.S. is still in the early stages of convergence compared to Canada? And arguably, convergence hasn't necessarily been helpful in Canada for the industry as a whole?

Yes. It's a different marketplace. We have a certain level of expertise building out fiber and marketing fiber. And again, I'm not being cavalier about our expertise. Fiber actually is just a superior product. So you've seen in the U.S. market, whether it's Ziply has a great management team, but you also have a lot of start-ups recently over -- well, not as much recently about 5, 6, 7 years ago, who build fiber, and we're taking 30%, 35%, 40% share from the cable competitor. So it is a first-to-fiber business model, and you're bringing competition to a market that basically has copper and/or cable and whether it's Tier 1, Tier 2 or Tier 3 cable, you're now bringing a superior product to market and you're picking up market share. So again, fiber really is the star in that world. And Harold and team at Ziply have done a great job of driving penetration where they build fiber. And we're now in a world where we can expand kind of their build plans, and they've seen -- they haven't shown any change in ability to continue to drive penetration and capture market share where they do have fiber. So it's very interesting for us. And then if you get into mobility convergence, that's upside for us, ultimately. We don't -- we haven't seen an ability -- a need to do that just yet in terms of there's been no slowdown in their ability to drive subs and penetration. If it does become more important in the market, then obviously, we have the ability, but that wasn't part of our investment case. So it's all upside for us.

And sort of on the Ziply build-out plan, the current expectations include a pretty significant ramp in the pace of fiber build in the back half of the year and then even more so in '27 and '28. Part of that, you've talked about the deliberate pullback after the deal closed. What kind of obstacles are you facing in the U.S. footprint that are impacting the pace of build? And what makes you confident that you can ramp quick enough to hit that $3 million target?

They have a strong build engine. And ultimately, it's just permitting, right? I mean it's time to get permits so that you can get shovels in the ground. But -- as we look at it, we took a half beat of a pause to make sure under different constraints, different parameters, management was able to identify the best places to go, not just limited to their copper footprint and not just limited to kind of ABS funding and what that could grow. So -- much more flexible constraints and parameters. So the goal is it, hey, let's build where we have copper. It's let's build in the locations where we're going to drive the most value to shareholders. So that took us half a beat, and now we get to run faster. So I think all in all, it's a good news story. And as you said, we just keep ramping up that build engine by the second half of this year and going forward. So we march along to get our 3 million homes by 2028.

And sort of a little follow-up on that. On the Ziply build, what sort of KPIs determine where you're looking to build? I know you just talked about a little bit, but is it, I guess, how -- what would be the most material or how even rank them competition, deployment costs, ARPU potential?

All of the above, right? We tend to look at it as what's the best place to drive IRR, right? I mean we're looking for returns. So whether that's ARPU, whether that's cable competitor, whether that's proximity. I mean, generally, everything is close to Ziply's core fiber network because they have a lot of core fiber network. So cost to build, efficiency of marketing, all of those things go into the equation, all the assumptions that you would think of going into the equation, and it's really just what is the most efficient place to build and continue to scale the business.

Maybe switching gears a bit to the balance sheet. The path to reach 3.5 leverage by next year includes non-core asset sales. Can you talk more about any asset sales that are in the pipeline, maybe given a sense of what we can expect in 2026? And could this include tower monetization?

Yes. Look, our deleveraging plan includes a bit of everything. So we are continuing to drive a lot of free cash flow. We're driving EBITDA growth. And we've talked about in the past, continued asset sales. We've sold off some assets. Obviously, MLSE, our legacy home monitoring business. We have a couple of files on the go. Again, nothing core to our business.

Tower sales is obviously a file that has kicked around for the last decade in even longer than that in Telco world. There's clearly a lot of value in our infrastructure. So it's something we'll consider, but ultimately, everything is viewed within the same lens. Does it accelerate our ability to drive free cash flow growth and value for our shareholders? And if it does, then we'll have to consider it.

I guess in the same vein, what triggers would prompt you to revisit the dividend level? Again, is it primarily just tracking to the leverage goals?

Yes. It's -- again, we do revisit the policy and the Board obviously makes that decision. But I'd say over the 3-year horizon here, where we're getting to 3.5 and then sub 3.5 leverage, and we're funding our growth initiatives. There's no expectation that our dividend would increase. Again, if we just blow the doors off of our free cash flow, and we have to revisit it, then that's a good news story. But in our base case, we are focused on deleveraging and funding the significant growth opportunities over the next 2, 3 years.

And on those growth opportunities, AI-powered solutions, major focus growth drive in the next couple of years. Can you talk about sort of the different business models between the different segments, cyber, Ateko and AI Fabric? And anything to flag in the pipeline for AI Fabric that you can talk about?

They all work together. So Bell Cyber is a security business, it's a recurring business model, but it ties in well with Ateko. Ateko is managed service, professional service. It's workflow management. It's cloud migration. It's helping companies actually leverage their spend and drive results. So whether that's companies like ours, I mean they're doing work for us as well because we're all going to spend money on platforms, whether it's Salesforce, ServiceNow, we're all migrating to the cloud or somewhere on the journey. We're all looking to maximize value out of AI spend. So the economy in all these companies are spending money. Ateko helps them actually drive value for the spend. So it's one thing to spend money and move to the platforms, but you actually have to capture the value and capture the efficiencies. So Ateko is helping us do that and helping kind of its customers in -- across North America do that.

So very complementary, especially when you look at our fiber footprint. So when you look at AI fabric, it's AI fabric. And if you're running inference or you're running data models, testing models, obviously, it needs to be secured. That's where Bell Cyber comes in. It needs to run on the best network. That's where fiber comes into play. And again, you need to figure out how to actually capture value out of the test you're running and the kind of technology spend, that's where Ateko comes into play. So separate lines of business, separate business models, but they all really work well together.

And then in terms of AI Fabric, the question you asked, there's a lot of demand, but it is lumpy as we've said. So when we're actually signing contracts because again, we're not putting money into the ground before we sign contracts. So we're able to actually generate strong north of 20% returns, but the risk profile is actually underweighted because we wait until we have contracts before we start putting shovels into the ground. So -- it will be lumpy, but the demand is strong and ultimately, we'll keep everyone abreast here when we sign contracts.

And just one more for me, and then we'll go to some questions coming in. So if you haven't already, feel free to submit questions in the chat box or you can e-mail me directly. So before we move on to that, last one, just on guidance. Thinking about the high and the low end guidance ranges, how much of that swing is based on more macro factors like economic slowdown versus core industry drivers like improvement in promotional activity and wireless pricing?

Ultimately, it's all of the above. I mean some of these are macro items, some of them are within our control. So if we can outperform our continued churn improvement, that's upside for us. I mean if ARPU and competitive marketplace in your words, winds up being a little bit more helpful on the ARPU side and turns around a little faster, then that's good news relative to the plan. But we -- our base plan really hasn't assumed a spike up in the macro environment. I think we're living in this backdrop and competing in this backdrop. So if it improves, if immigration improves, if ARPU improves, those are all upsides for us. But again, for us, it's continue to do the blocking and tackling of delivering for customers, lowering churn, selling our fiber footprint, continuing to sell our digital platform like Crave 1 million-plus subs last year, continue to drive Crave subs. So for us, we're just blocking and tackling with the strong assets we have.

Thanks, Curtis. So a couple of minutes left. We're going to get some questions. How is managing -- this is simply. How is managing things like inflationary cost pressure, supply chain constraints and build costs different in the U.S. compared to Canada?

Yes. In terms of supply chain constraints, there really aren't any supply chain constraints at this point. So I'd say it's the same. I mean we have access to materials. In a world, it's kind of a unique world where the Canadian asset actually brings scale to the U.S. assets. So in terms of procurement and economies of scale, we actually bring that benefit to Ziply. So they haven't seen any issue actually procuring or sourcing information -- sourcing equipment and goods, and it's probably improved a little bit as they as they leverage kind of either their contracts or our contracts. And then ultimately, they're just executing, right? So the real time line is the many different jurisdictions where they're looking to build and fiber build is a community by community, municipality by municipality kind of effort. So it's really just getting permits to build out. So it's not an equipment shortage. It's just the time line of identifying where you want to build and getting it done.

And one on the cost-cutting initiative. You had your $1.5 billion of cost efficiencies. How do you think about the most material efficiency initiatives? Is it AI and customer care, network automation, something else?

It's really all of the above. So those are two very good examples, it's really all of the above. If I had an umbrella comment, it's leveraging technology to eliminate manual work and eliminate friction in the system. So whether it's friction with customers where they have to call back 3x, right, I mean, just get it right the first time. Give them the right offer the first time. And if you say you're going to call them back, call them back right away. So it's eliminating friction along kind of the relationship and the experience. And that's internal as well, right? So if you're going from one group to the other or an external customer internally, reduce the number of steps and automate where you can. It just simplifies in the fewer steps in a process, the less likely you are to make mistakes. And the more you can automate, again, the less likely you are to make mistakes. And have kind of spend money that you don't need to. So it's not just cost savings, it's cost efficiency. It's kind of a unique spot where you can provide better service to customers and actually have it cost you less money. So it's a nice win-win for us. I mean when -- the investments we've made over the last few years are already capturing results.

And one on Enterprise. I think you've already touched on this a bit, but I think Enterprise is one of the areas that's expecting a growth turnaround with some of these AI solutions. So question is how concentrated is the enterprise revenue base? And how much could customer renewals or timing on renewals swing results?

Enterprise revenues and contract renewals tend to be a little bit lumpy, but it's such a big business for us that it smooths out naturally. So on a contract by contract, yes, it's lumpy. But overall, the business other than AI Fabric is not as lumpy. And ultimately, we've done a pretty good job managing the legacy side of the business and we're growing the growth side of the business. So it's a pretty good combination of both when you look at our Enterprise business relative to our competitors. And starting in Q1, we'll start breaking out a bit more information so that analysts and investors can track Enterprise revenue separate and apart from consumer, realize the wireline data number is a big number. But ultimately, it's continued focus on the growth areas and continued focus on managing the legacy and ultimately pretty good performance on a relative basis, I'd say even stronger relative.

And we have one more in the queue. If anyone else has a question, feel free to submit. This is on hardware upgrades. How do you think about managing the device financing economics and handset margins? And how has that approach changed?

I can say, ultimately, it is one of the levers we have to manage churn, but overall, manage the customer experience. So we're not in a subsidy world. That business model went away in Canada a handful of years ago, start of COVID. So it's -- there's a little bit of a working cap carry, but it's not -- it's not what it was 5, 6 years ago. So ultimately, for us, and we leverage AI here, too. But ultimately, for us, this is just managing the customers' journey over the long term, right? Happy customers equals higher long-term value, less churn. So it's one of the levers we have. It is what customers are looking for in certain instances. So again, if it drives long-term value and it keeps customers happy, then is something that we'll put on the table. And again, it drives long-term value for us as well.

Thanks, Curtis. No more questions, and I think we're right about time. So thank you so much for joining us, Curtis. Really appreciate having you here.

Appreciate this stuff, and good luck today.

Thanks.

Good morning, ladies and gentlemen. Welcome to the BCE Q4 2025 Results and 2026 Guidance Call.

I would now like to turn the meeting over to Kris Somers. Please go ahead, Mr. Somers.

Thank you, Matthew. Good morning, everyone, and thank you for joining our call. My name is Kris Somers, Head of Investor Relations. And with me here today are Mirko Bibic, BCE's President and CEO; and Curtis Millen, our CFO.

You can find all our Q4 disclosure documents, including our safe harbor notice concerning forward-looking statements on the Investor Relations page of the bce.ca website.

Before we begin, I'd like to draw your attention to our safe harbor statement on Slide 2 of the presentation, reminding you that today, remarks made during the call will include forward-looking information, and therefore, are subject to risks and uncertainties. Results could differ materially. We disclaim any obligation to update forward-looking statements, except as required by law. Please refer to our publicly filed documents for more details on assumptions and risks.

With that out of the way, I'll turn the call over to Mirko.

Thanks, Kris, and good morning, everyone. I'm looking forward to walking through our results and outlook with you in a short moment. First, I want to take a moment to frame where we are. In 2025, we had a pivotal year for BCE. It was a year of deliberate change, where we strengthened the balance sheet, we sharpened our capital allocation discipline and clearly defined our long-term strategy at Investor Day in October of 2025.

And over the course of 2025, we aligned the organization around 4 strategic priorities that leverage our unique and differentiated assets across fiber, wireless, enterprise and media to deliver the very best for our customers, and we set clear measurable targets for the next phase of growth. So that groundwork is now in place. The strategy is clear. The priorities are set, the company is aligned, and we've begun to execute against that plan. You could see that execution translate into momentum throughout 2025, including the fourth quarter, as we focused on improving customer experience, strengthening fiber and wireless network leadership in Canada, establishing a fiber growth platform in the U.S., accelerating momentum in enterprise and digital media and positioning the business for sustainable free cash flow growth.

And I'd like to start on Slide 3 of our deck with an overview of how we executed last year against those 4 strategic priorities. So putting the customer first, that remains foundational, and the results are tangible. Postpaid churn improved for the third consecutive quarter with a 17 basis point year-over-year improvement in Q4. Importantly, the magnitude of improvement accelerated throughout the year, demonstrating sustained momentum as our customer-first initiatives take hold.

We made important progress in 2025 with the launch of differentiated wireless plan tiers that move beyond traditional data buckets. These plans give customers clearer choices based on the experience they value most, including network performance, video quality, roaming features, device financing and bundled content. We expanded our lead in distribution with no name mobile now available in all Maxi stores across Quebec, extending access to affordable contract-free wireless options powered by Bell's network. This reflects our customer-first focus on accessibility and choice across segments while maintaining disciplined brand positioning.

We also advanced the customer experience in 2025 with the rollout of our AI-powered voice virtual assistant across Bell, Virgin Plus and Lucky Mobile. This simplifies interactions at scale and improves service quality. Our customer-first focus is reflected in the latest CCTS report, which showed that Bell continues to have the lowest proportion of complaints among the 3 largest national carriers. While there's a lot more work to do, the progress made last year reinforces our focus on continued churn improvement and further gains in customer experience metrics such as NPS.

In wireless, we continue to build momentum through 2025 with a clear improvement in our underlying ARPU trajectory and strong net new postpaid mobile phone additions on our main Bell brand, and that supports ARPU improvement going forward. We continue to take a disciplined approach to subscriber acquisition with a focus on quality and lifetime value rather than chasing volume. And you can see this in wireless service revenue, where the year-over-year rate of decline improved to just 0.2% in Q4 with consumer wireless service revenue stable in the quarter.

Fiber continued to be a key growth driver last year with approximately 200,000 net new subscriber additions, including our U.S. operations. This contributed to Internet revenue growth of 8%. Where we have fiber, we continue to win through superior network performance, higher customer satisfaction and stronger multiproduct penetration. The acquisition of Ziply Fiber marked a key milestone in our fiber growth strategy, giving us a strong platform for long-term growth in the rapidly expanding U.S. market.

In 2025, Ziply's financial results reported in our Bell CTS U.S. segment were comfortably in line with the expectations we outlined at Investor Day. Since closing the acquisition, we've worked closely with the Ziply management team to refine and accelerate their fiber expansion plan. And with the Network FiberCo partnership now in place, the build has been re-prioritized toward higher-growth markets with construction set to ramp meaningfully in the second half of 2026 and beyond. So this positions 2026 as an important build year for Ziply, putting us on the path toward our target of approximately 3 million fiber passings by the end of 2028 with a longer-term opportunity to reach up to 8 million locations in a capital-efficient manner.

We also made continued progress on product intensity, driven by increased adoption of content subscriptions. With Crave adding more than 1 million subscribers in 2025, we're seeing clear momentum in the number of services per household. Our focus remains on growing the number of services per household through mobility, Internet and content. We also launched hardware-free Fibe TV, delivering a full-service experience without the need for a set-top box and allowing customers to use devices they already own. This simplifies installation and ongoing service, reduces complexity and supports higher product intensity while remaining highly scalable and capital efficient.

Bell Pure Fibre and 5G wireless were once again recognized by Ookla as Canada's fastest networks with Bell Pure Fibre also recognized as the fastest Internet service in North America. This independent third-party validation reinforces the strength of our network leadership and customer value proposition.

Now turning to Slide 4, and our next strategic priority, which is lead in enterprise with AI-powered solutions. In 2025, Bell Business Markets delivered relatively stable revenue and EBITDA performance, which really stands out in an environment where many enterprise telecom businesses continue to face pressure. This reflects the actions we've taken over the past 18 months or so to reshape our enterprise strategy.

The 3 AI-powered solutions businesses we launched in 2025, Ateko, Bell Cyber and Bell AI Fabric, were key contributors, collectively growing approximately 60% year-over-year to around $700 million in revenue. Each of these is scaling as planned, and each supports our goal of reaching $1.5 billion in AI-powered solutions revenue by 2028. Importantly, this represents largely net new revenue and EBITDA for Bell, which complements rather than replaces our core connectivity and communication services.

We continue to strengthen these platforms, including Ateko's recent acquisition of SDK Tek Services, which took place in December of 2025. SDK Tek adds deep data engineering and analytics expertise, helping enterprises and governments organize and use their data effectively, and that's critical to deploy AI at scale. The acquisition improves our full stack AI solution set.

Now turning to media. Our digital strategy continued to deliver in 2025 with digital revenues up 6% year-over-year and now representing 44% of total media revenue. And this performance was powered by Crave, which, as I noted earlier, had an outstanding year, ending with 4.6 million subscribers alongside continued growth in connected TV, Crave with ads and FAST channels. Our focus for Bell Media is to deliver consistent annual revenue and EBITDA growth, and we achieved that in 2025 as the business continues to shift toward higher-value digital and subscription revenue streams.

We also made a significant transformation to the Crave platform, expanding the content library by more than 10,000 hours and integrating live programming from CTV and Noovo, news, select major sports and premium entertainment events and an expanded kids' collection. All of this supported by meaningful user experience enhancements.

Our focus on original content was another key driver in 2025. Early in the year, Empathie became a major French language success in Canada and gained strong traction in France. More recently, Heated Rivalry has emerged as a global sensation, generating significant media attention and cultural impact and underscoring the strength of our investment in premium Canadian storytelling. From a strategic standpoint, our focus is on delivering premium content to customers through digital platforms and extending its value by monetizing that content more effectively across the full value chain.

And looking ahead, Bell Media is off to a strong start in 2026. NFL viewership through the playoffs has been very encouraging, and we're excited about the FIFA World Cup this summer, which presents a significant audience and monetization opportunity. So taken together, Bell Media is contributing meaningfully to growth, churn reduction and customer lifetime value across the Bell ecosystem. Overall, therefore, across all 4 priorities, 2025 was about building momentum.

So now, I'll turn to Slide 5. I want to touch briefly on capital allocation because this, too, has been a consistent focus for us over the past year. If you go back to our February 2025 call, pretty much exactly a year ago, we were very clear about what we intended to do and that simplify the business, strengthen the balance sheet, focus capital on higher return opportunities and return capital to shareholders through a sustainable dividend. And we reinforced that roadmap at Investor Day in October of 2025, providing greater transparency around our capital allocation priorities, leverage targets and investment framework. The roadmap has not changed.

Turning to Slide 6. This highlights the early progress we're making against the 3-year targets we laid out at Investor Day. These are some of the metrics we'll use to measure progress. They include churn, Bell-branded loadings, product intensity, Internet market share, U.S. fiber expansion, AI-powered solutions growth and Crave subscriber and digital mix at Bell Media. This scorecard is how we intend to manage the company and how we expect to be measured. We're still early in the execution phase, and we're encouraged by the momentum we're seeing. Taken together, these indicators show that the strategy is translating into disciplined execution. 2025 set the foundation, and in 2026, the dedicated Bell team will continue to execute our way to the 2028 targets with a clear focus on delivering sustainable returns for our shareholders.

And with that, I'll turn the call over to Curtis, and Curtis will walk you through our Q4 operating results and the 2026 financial guidance. Thanks for your attention, everyone.

Thank you, Mirko, and good morning, everyone. Our strong fourth quarter and full year 2025 financial results demonstrate the stability of our business and our ability to deliver on the strategic and financial commitments we outlined over the past year, including at Investor Day. On a consolidated basis, we achieved all of our 2025 financial guidance targets, reflecting disciplined execution across the organization. 2025, service revenue increased 0.6% for the year, supported by contributions from Ziply Fiber and continued resilience in our core businesses.

Adjusted EBITDA increased 0.7%, driving a 20 basis point improvement in adjusted EBITDA margin to 43.6%, the strongest annual margin result we've delivered in more than 30 years. Adjusted EPS declined 7.9% in '25, consistent with our guidance and primarily reflecting higher depreciation and amortization from ongoing network investment, along with increased interest expense.

Capital expenditures declined by $197 million to $3.7 billion, resulting in a capital intensity of 15.1%, in line with guidance and consistent with our longer-term objective to reduce capital intensity. We delivered a 10% increase in free cash flow to $3.2 billion toward the upper end of our guidance range, driven by higher EBITDA, lower CapEx and improved working capital. Free cash flow after payment of lease liabilities increased 17.5%, an important metric in the 3-year financial outlook we shared at Investor Day, where we continue to target approximately 15% CAGR. We're entering 2026 with solid momentum in cash generation.

At the segment level, there's clear momentum at Bell Business Markets, reflected in relatively stable revenue and EBITDA in '25, while Bell Media delivered positive revenue and EBITDA growth for the full year, consistent with the execution themes Mirko outlined earlier.

Turning to Q4 on Slide 9. I'll begin with a summary of Bell CTS Canada subscriber metrics. Postpaid wireless net adds of 56,124 were essentially stable year-over-year despite a less active market. Consistent with our well-articulated strategy to balance loadings with improved financials and customer experience, we focused on higher-quality margin-accretive subs again this quarter.

As a result of this continued disciplined approach, we added a significant number of customers on the premium Bell brand. Postpaid churn improved 17 basis points to 1.49%, marking our third consecutive quarter of year-over-year improvement. This is a direct outcome of our focus on putting the customer first. Mobile phone ARPU declined just 0.8%, significant improvement from the 2.7% decline in Q4 of last year. We also saw a recovery in consumer roaming revenue, which has continued into the early part of Q1 and is encouraging for future ARPU performance.

In Wireline, we delivered 43,000 fiber-to-the-home Internet net adds in the quarter, a strong result given the slowdown in our Canadian fiber build and disciplined pricing, reflective of the value we deliver to customers.

Let me turn now to Q4 financials for Bell CTS Canada. Internet revenue increased approximately 2%, reflecting the same approach as in wireless, a healthy balance between sub growth and disciplined pricing supported by fiber. In our Enterprise business, AI-powered solutions revenue grew 31%, driven by continued momentum at Ateko and Bell Cyber. We remain focused on scaling these growth vectors as part of our plan to reach $1.5 billion in AI-powered solutions revenue by 2028.

Wireless service revenue declined 0.2%, an improvement from the 0.4% decline in Q3 and meaningfully better than the 1.5% decline in Q4 of last year. Importantly, consumer wireless service revenue was stable year-over-year in the quarter, an encouraging sign as we enter 2026.

On the product side, revenue declined $170 million year-over-year, driven by a pronounced market shift towards BYOD activity in December, which resulted in a 20% reduction in contracted device sales as well as the timing of certain wireline equipment deals with large enterprise customers. Importantly, the EBITDA impact was limited, as these product revenues are very low margin. Overall, EBITDA performance was in line with plan, and adjusted EBITDA margin increased 130 basis points year-over-year to 44.2%, reflecting strong cost discipline, including a 6.1% reduction in operating costs and margin-accretive subscriber growth.

Turning to Bell CTS U.S., which reflects the results of Ziply Fiber's operations. As Mirko mentioned earlier, Ziply's financial performance for 2025 was consistent with the expectations we shared at Investor Day, reflecting solid execution, as we position the business for its next phase of growth. In the fourth quarter, total revenue was $232 million, driven by continued strength of Ziply's fiber platform. Internet revenue grew in the double digits, supported by ongoing expansion of the fiber footprint and strong customer penetration across new and existing markets. Bell CTS U.S. delivered $100 million of EBITDA in Q4, representing a 43.1% margin, demonstrating strong operating leverage in the business.

With significant runway ahead, we expect robust revenue and EBITDA growth from Bell CTS U.S., as the management team advances Ziply Fiber's 2028 financial ambition presented at Investor Day. On the subscriber front, Ziply added more than 6,000 net new fiber customers in Q4, supported by footprint expansion and strong penetration in newly built areas. Ziply Fiber build plan has now been reprioritized toward higher-growth markets and is set to accelerate in 2026, putting the business on track to reach approximately 3 million fiber passes by the end of 2028.

Turning to Bell Media on Slide 11. As projected, total revenue declined 3.4% in Q4. Despite strong digital video advertising growth, total advertising revenue was down 11.1%, reflecting continued softness in traditional advertising, demand for non-sports programming as well as the impact of the divestiture of 45 radio stations, which was completed in the first half of 2025. Subscriber revenue increased 1.5%, driven by continued strength in D2C Crave and sports streaming.

Crave's direct streaming subscribers grew 65% year-over-year, supported by market-leading content, including Heated Rivalry, which continues to generate strong domestic and international engagement and underpin subscriber growth. Operating costs declined 1.5%, driven by lower content costs and ongoing operating efficiencies. Importantly, Bell Media delivered positive revenue and EBITDA growth for the full year, consistent with our objective for this business to be a stable and growing contributor to BCE's financial performance. Our focus remains unchanged for Bell Media to consistently deliver annual revenue and EBITDA growth, while contributing meaningful free cash flow to BCE, as the business continues to shift toward higher-value digital and subscription revenue streams.

I'll now turn to our 2026 outlook, beginning with revenue and adjusted EBITDA on Slide 13. Our 2026 guidance is fully aligned with the 3-year financial outlook we shared at Investor Day and reflects continued momentum in our core growth engines, fiber, wireless, AI-powered enterprise solutions and digital media, while we continue to diligently manage the clients in higher-margin legacy services. For 2026, we expect consolidated revenue growth of 1% to 5% and adjusted EBITDA growth of 0% to 4%, representing a step-up from 2025 with these range is consistent with prior years. And I'd note, we remain highly focused on operating efficiencies and continue to expect to deliver $1.5 billion in cost savings by 2028.

Over to Slide 14 for a summary of our adjusted EPS outlook. We project adjusted EPS to be in the range of $2.5 to $2.65 per share in 2026 or 5% to 11% lower versus last year. This decline can be largely attributed to an approximate $250 million step-up in depreciation and amortization expense, reflecting continued investment in our broadband networks as well as the impact of the Ziply Fiber acquisition and an estimated $100 million increase in interest expense, driven by a higher level of debt outstanding related to Ziply Fiber acquisition. In addition, we expect tax adjustments to be around $0.02 per share lower than in 2025, as we are not forecasting any tax adjustments in 2026.

Turning to Slide 15. We expect another strong year of free cash flow generation in '26. Free cash flow is projected to grow between 4% and 10%, reflecting strong flow-through from higher EBITDA and lower year-over-year severance payments, partially offset by higher interest paid. Consistent with the outlook we shared at Investor Day, capital expenditures in 2026 are expected to remain relatively stable at approximately $3.7 billion, resulting in a lower capital intensity of 15% or less. Within that stable total CapEx envelope, we'll continue to fund our growth initiatives, supported by efficiencies from prior investments that are reducing ongoing run-the-business capital requirements and creating additional flexibility to allocate capital towards strategic investments and growth opportunities.

Our free cash flow outlook also reflects stable to slightly lower cash taxes, largely unchanged working cap position and essentially flat cash pension funding as we continue to benefit from a full contribution holiday, supported by the strong solvency position of our defined benefit pension plans. With this level of robust and predictable free cash flow generation, we expect BCE's dividend payout ratio to remain comfortably within our target policy range of 40% to 55%. Finally, we remain focused on driving strong free cash flow growth after payment of lease liabilities, supported by lower year-over-year capital lease repayments in '26 and consistent with the approximately 15% CAGR target we outlined at Investor Day through 2028.

Turning to Slide 16. As we begin the year, we have $2.5 billion of available liquidity and a pension solvency surplus of $4.4 billion, providing meaningful financial flexibility as we execute our 2026 business plan. Our long-term debt maturity profile remains very manageable. In fact, $750 million of '26 MTN maturities were prefinanced and early redeemed in 2025, further reducing near-term refinancing risk.

At the end of 2025, our net debt leverage ratio was approximately 3.8x adjusted EBITDA, unchanged from prior year despite the closing of the Ziply Fiber acquisition. On a pro forma basis, adjusted to include a full 12 months of Ziply Fiber, our net debt leverage ratio would have been approximately 3.7x. It's also worth noting that nominal net debt at year-end was $40.2 billion, slightly lower than the $40.3 billion reported at the end of '24 and notably prior to the closing of the Ziply Fiber acquisition, underscoring our continued focus on balance sheet discipline. Overall, we remain sharply focused on deleveraging with our net debt leverage ratio expected to continue trending down in '26 toward our target of 3.5x by the end of 2027.

To conclude, on Slide 17, our 2026 financial targets position BCE to deliver on the 2028 ambitions we set out at Investor Day. The guidance reflects clear progress from 2025 and remains fully aligned with our 3-year financial framework. We're guiding higher revenue, higher adjusted EBITDA, improving capital intensity, strong free cash flow growth and a sustainable dividend. Taken together, these targets reinforce our confidence in the strategy and in our ability to execute and deliver sustainable financial performance over the 3-year horizon.

With that, I'll turn the call back over to Kris and the operator to begin the Q&A.

Thank you, Curtis. [Operator Instructions]. And with that, Matthew, we're ready to take our first question.

[Operator Instructions] The first question comes from Tim Casey from BMO Capital Markets.

Could -- you talk a little bit about your guidance ranges, 1% to 5% and 0% to 4%. Those -- obviously, there's a few swing factors in there. Maybe just what's influencing you? Is it competitive intensity? Is it economic issues? Just maybe walk us through your thinking on the guidance ranges, if you could, please.

Thanks, Tim. I'll start, and then, Curtis can layer on. I think what you're seeing in the guidance we're giving you on revenue and EBITDA certainly is a reflection that our growth segments continue to grow as we signaled they would, and we continue to need to manage the legacy declines as carefully as we possibly can, and we transparently unpack that for everyone in October last year.

So on the growth side, the proof points are the premium Bell loadings, the churn, the product intensity, the fiber net. Of course, we want to continue to improve service revenues. And in there, you've got AI-powered solutions revenue, both in totality and then within the -- and organically, continue to guide towards positive Bell Media revenue and EBITDA. There's the U.S. opportunity, and of course, free cash flow growth, which is pretty healthy while funding strategic initiatives. So that's on the growth side.

And then the swings potentially are wireless penetration gains and overall market growth in wireless. Of course, the state of pricing in wireless and wireline, both. I already talked about managing legacy, but you've got within that legacy advertising declines and legacy declines generally. The overall economic environment factors into our assessment on the range. And then the last 2 things I'll say is while we've got good momentum in AI-powered solutions and in cost transformation, are we able to further gain even better momentum in both of those, and that could swing to the positive depending on the traction we continue to get.

Anything to add, Curtis?

Yes. I'd just add, it's a detail. We're not targeting to reach low end of the range. We're targeting higher than that, but it is appropriate to have a range. And I'd just note the spread of the range is consistent with the last couple of years. So again, we think this is the appropriate range and consistent with our past practice.

Just as a follow-up, any comment on what we're seeing in the wireless pricing environment and what usually is a very tepid loading environment and promotional environment? There seems to have been a little more activity than some of us would have expected in January. Just what are your reflections on what's going on in wireless so far in '26?

Yes. Thank you for the follow-up, Tim. I'll start with something that does need to be said, particularly with one of our key priorities being putting customers first. It's pretty clear that over the last, call it, number of years, certainly 3 years or so, we see consumers getting tremendous value from the wireless services we offer. You got lowering prices, improved network service enhancements, feature enhancements and basically the benefits of robust competition across the country. So that's important to say.

Within that context, I think probably what I'll say, Tim, is that we're continuing at Bell to be disciplined. And that's a function of just sticking to our plan and being diligent in our execution. So for us, and this is not new, we're really focused on the bell loadings because the market is shifting to Tier 1 brand value proposition with 5G, with mobility, Internet and content. We're trying to improve the service revenue trajectory. We're really dialed in on base management. And if you go back to a year ago, we basically set out ARPU dilutive loadings in January of 2025, and yet, we still delivered strong full-year loadings. It just shows you that the discipline is working.

And more recently, in the past month, January of this year, I think you saw some pretty aggressive promotions, the past 2 weekends, from some of our peers, and we decided to sit that out as well because what we're trying to do is get an appropriate share of wireless nets, profitable transactions, leveraging the premium tier. And we're focused on strong channel execution, both in retail and online and in the call centers.

Our next question is from Stephanie Price from CIBC World Markets.

In terms of my question, I was hoping you could walk through what's baked into the guide in terms of Ziply, how we should think about growth and margins in that business in '26? And maybe my follow-up is a bit on the U.S. competitive environment and if you're seeing any changes in the Ziply footprint here.

Right. So on Ziply, we're pleased. So 2025 ended exactly as we -- pretty much exactly as we telegraphed it would in -- at Investor Day for 2025. So that remains the case. And the performance does remain above our initial investment case when we announced the potential transaction back in November of 2024. So good on both of those fronts.

In terms of the underlying fundamentals, Stephanie, demand for fiber, it's all about fiber and the underlying fundamentals remain strong for fiber, whether or not it's demand for fiber, customer preference penetration gains, where we do have fiber, and the long-term economics, all that remains very supportive and beats cable on pretty much all the metrics, speed, reliability, latency, product expansion, overall experience. And that dynamic hasn't changed either competitively on the ground in the states where Ziply is operating.

And then just in terms of -- you mentioned a significant ramp in H2 in terms of the rollout at Ziply. Just curious how you're thinking about CI and the pace of the fiber rollout in the U.S. business?

Go ahead on CI.

Yes. Thanks for the question, Stephanie. And look, I would say we do manage CapEx and capital intensity on a consolidated basis. So we are expecting capital intensity overall to drop, but fixed dollars remaining the same. You're not wrong, though. I would expect CapEx dollars spent in Canada probably go down year-over-year and with an increase in the U.S. But again, we're managing that on a consolidated basis and gives us the ability to reallocate capital towards higher-growth initiatives. So we're happy to have that flexibility, and frankly, that stronger opportunity in front of us.

Our next question is from Jerome Dubreuil from Desjardins Securities.

I'll just follow up a bit on Tim's questions there. But after seeing what has happened with the wireless landscape over the last few weekends, have you changed your expectations for 2026 or padded the downside a little bit better?

So that's -- Jerome, that's built into the ranges on guidance that we've talked about. If you focus on -- maybe if I take a narrower focus on the question and go straight to ARPU, for example, so when we came out of Black Friday in November of 2025, we thought it would be possible to show moderate ARPU growth by Q4 of 2026. And with the pricing we saw in December of 2025 and what we've seen some of our peers do in January, it might be more difficult to get there. But there's still 11 months left in the year. And I think -- broadly speaking, I think there are signs that we can go back to the level of pricing we saw more of in October, November, particularly while delivering the tremendous value for consumers, which I talked about earlier when I was discussing with Tim.

Okay. That's helpful. In terms of the next step for AI Fabric, I think the ROI opportunity there is pretty strong. Maybe if you can discuss the potential catalyst that you see down the road? Are there -- is there an inflection in demand? Are there announcements we should be expecting maybe from the different government levels?

Yes. So I'll try to take it. So on AI Fabric specifically, what we built in the 2026 plan and guidance is the monetization of a relatively small portion of the significant amount of overall capacity we currently have available to monetize over the coming years. And so that's based on our confidence to deliver those sites in year in 2026. So that's built into what you see today.

We are in active discussions across multiple additional opportunities, and we've been sharing that consistently. And that's based on the pretty strong interest and sales funnel we have. There's a lot of demand for the capacity we do have. And so there are discussions that are ongoing.

Our next question is from Maher Yaghi from Scotiabank.

Maybe I'll start with your assumptions on 2026 wireless subscriber growth for the industry or maybe better if you can give us some indications about what you expect you can achieve. You talked about ARPU. And so when I think about the pricing picture, Mirko, you mentioned that given what you saw in Q1 so far and late in Q4, you might not show a return to positive ARPU growth. I don't think that's -- I think the general market is in line with that view. But do you believe that the first couple of big discounts we saw this quarter in the last week, 2 weekends have hurt you in any way in terms of achieving your goals in subscriber loading for Q1? I'll start with that question, and I'll have another question on convergence after.

Okay. So there's -- thank you, Maher. There's kind of a few elements in that. So let me start with market growth generally. Our view of wireless market growth, to keep it short, is broadly consistent with what you heard last week from one of our competitors. So we also continue to see market growing at a low single-digit rate, and that just reflects a more mature market and lower overall volume growth and increases in penetration. So that's on that part.

I -- in terms of how we're going to operate, it's -- I mean, I don't want to repeat too much of what I said at the beginning in response to the first question, but what we saw in January of this year, particularly the last 2 weekends, it doesn't change the delivery, our execution against our goals because we are going to stick to our plan. We are going to be disciplined. It's all about having a strategy and then executing against that and not deviating because of 1 or 2 weekends.

So our approach remains Bell loadings, accretive loadings sitting out ARPU dilutive loadings, product intensity. So we're going to continue to execute against that. We're doing reasonably well. What we want to get is our appropriate share of market loadings. And on ARPU growth, which was kind of the third element you outlined in your question, I guess I'll end here where I ended on the previous question to when I was discussing with Jerome. There are still 11 months left in the year. So there's lots of opportunity here to deliver on what we all thought we'd be able to deliver, particularly by the end of this year.

Okay. That's fair. So my second question or follow-up is on convergence. Wireless, wireline bundles is not something new, of course. But in a more competitive market, I look at your fiber footprint, the largest in Canada by far, and compare that with some of your U.S. peers, which are trying to catch up and have made convergence their #1 priority, I would say. How much upside do you believe BCE can achieve from leaning on your fiber footprint to increase your wireless market share? And could you share with us what percent of your wireline footprint base is also a wireless customer of BCE, just to have some kind of a reference compared to what we hear from your U.S. peers?

So I think -- I don't have it at my fingertips, Maher, but I think at Investor Day, we did outline our goals on product intensity in terms of percentages, 25% product intensity increase between now and 2028. So we are trying to -- that answers your question is do we think there's upside? 100%, we think there's upside, and we gave the upside target over the 3-year timeframe. And that's largely on the back of an expansive fiber footprint, coupled with the best premium content in the business in Crave and continued leadership in wireless. So -- I know I'm giving you more of a general strategic question -- point of view. So that's the strategy. The strategy is born from a belief in tremendous upside. The upside is going to come through disciplined execution.

And in terms of the specific stats you're asking for, I don't think we'll give that here on the call.

Our next question is from Sebastiano Petti from JPMorgan.

I guess just following up on Stephanie's question related to perhaps the U.S. environment. What you've seen here in the U.S., I guess, is scaled fiber operators seem a bit more focused on driving penetration this year and largely have messaged that ARPU growth might be a little bit muted. I mean -- and then the cable operators, Comcast, Charter, who you compete with in the vast majority of your Ziply footprint, have largely messaged as well that ARPUs or price increases will not necessarily be passed through here, as they try to focus on churn reduction, gross addition improvement. While still early, and I think you just kind of hit on it, Mirko, in your answer to Maher's question there that I presume a lot of the growth is volume-based. But boots on the ground, blocking and tackling, has anything changed in the strategy or Harold and the team's strategy in the U.S. kind of given the competitive environment? That's my first question.

And then, I'll just toss out my second one here as well. On Slide 5, you do talk about continued noncore asset sales as you optimize the balance sheet. Any update on current work streams or what we might be able to perhaps expect in 2026?

So on the Ziply part of the question, Sebastiano, so nothing has changed in terms of the strategy and the execution in the Ziply markets where we have fiber. We're continuing to see the penetration ramp exactly as we had expected and as Ziply had been performing prior to our acquisition. So all that remains quite solid.

On pricing, it's interesting, Ziply has typically not been the highest priced broadband provider in the markets it operates. So there's a price gap between Ziply and cable where Ziply's pricing has tended to be below that of cable. And what you're seeing just maybe more broad kind of take on the Ziply questions is what you're seeing in what we're signaling is the -- there's a deliberate reset here on our part quite strategically.

Prior to closing, Ziply's build plan was largely focused on upgrading its existing copper footprint within its existing ILEC territory. And as we said consistently, as we were leading up to closing of the transaction and since is that our long-term plan together with the Ziply management team is to go broader now. And now we have PSP in the Network FiberCo project. And the plan there is to build both within and beyond the ILEC footprint. And we're going to do that in a sequential and capital disciplined way. So we plan to do the build now not only within the 4 core states, not only within the ILEC footprint in those 4 core states, but outside both the ILEC footprint and the 4 core states.

So if you kind of take that as the strategy, what happened is once we closed the acquisition, we took a bit of a step back and to reassess what had been the build plan so that we could tackle the wider geographic slate. And as we redesign the plan, what you're going to see is a little bit of a near-term slowdown in terms of the actual passings, but ramp, as we get to the back half of this year and into 2027 and beyond so that not only can we hit our 3 million locations passed target, but do it in the markets that we think are the most attractive.

And then the second question was...

Yes, Sebastiano, to get to your second question around asset sales. So I'd say consistent with our previous messaging throughout the year at Investor Day, we are focused on maintaining our discipline around capital allocation. One of our priorities is strengthening the balance sheet. You saw net debt slightly, but decreased even with the acquisition of Ziply. So we are continued -- we will continue to be focused. We are on track to reach our 3.5x net leverage target by 2027. And as we talked about previously, asset sales will play a role. We do have files underway. And as we reach agreements, we'll provide more transparency to the market.

Our next question is from Vince Valentini from TD Securities.

First, maybe just a clarification. Are we going to get Enterprise segment revenue starting to get disclosed discretely in the first quarter? I thought there was some indication at Investor Day, you'd improve enhanced disclosure.

And second, more of a question, employee purchase plans within the wireless segment. I know you've been saying for the last couple of quarters, the vast majority of your postpaid net adds are on the Bell brand, but the Bell brand includes these EPP plans, which sometimes are $35 or $40 for big buckets of data, including roaming in other countries as well. Can you give us any sense, is that a satisfactory level of your loading, Mirko? Do you think that's getting a bit out of control? And do you have good eyeballs and gates on making sure your in-store reps authenticate people to make sure they qualify for these EPP versus just giving it to anybody?

Thanks for the question, Vince. I'll do the second, and Curtis, you can answer the first.

Look, on EPPs, they are -- there's an EPP segment in the marketplace. We have traditionally, frankly, been gapped in EPP sales, both in terms of in the past functionality and as well as kind of a desire. By design, we've been gapped. We've over time fixed some of the product feature and execution gaps on EPPs, but our view hasn't changed on the strategy, which is we'll play where we need to, but we believe we are fundamentally disciplined executing against all core segments.

Again, the focus is disciplined execution on the most accretive loadings while remaining competitive as appropriate in each segment. And that's what we're going to continue to do, Vince. We -- and again, you just -- EPP is one part of it, but you see some of the above-the-line aggressive pricing that some of our peers have put in market the last 2 weekends, and we set out. We did the same thing last year in January 2025. And ultimately, when you look at the full year performance in 2025, we took our appropriate share of net adds, and that's because we focused on executing against -- at the right times throughout the year. And that's the thing -- that's what we're going to continue to do.

And Vince, just on your first question, the answer is yes. So starting Q1, we'll provide more detail in and around the enterprise segment.

Our next question is from Batya Levi from UBS.

Great. A couple of follow-ups. First on the U.S. Is it possible to size the build plan for this year? And what are some other opportunities you're seeing to accelerate the fiber plan in the U.S., maybe some tuck-ins? And convergence also a theme. And are you -- do you see adding an MVNO important to inflect your subscriber growth in the U.S.? And a quick follow-up on Canada, can you talk about the TPIA activity in broadband?

Okay. Thank you, Batya. So on M&A opportunities, I'm going to give you a general answer on M&A opportunities, and this applies to the U.S. or Canada. We'll always take a look at opportunities to drive shareholder value. Importantly, though, any one of those would have to fit within our capital markets goals and deleveraging targets. So I'll leave it at that on M&A in the U.S. or otherwise.

In terms of convergence, we -- at this moment in time, a converged offering in the U.S. is not required by Ziply in order to drive the penetration gains where we have fiber, and -- but we recognize that there may be a point in time that we'll want to do that, and we have a number of options available to us that we are looking at. So stay tuned for more on that over time.

In TPIA, yes, of course, TPIA, not -- in terms of our -- what we want to do -- fundamentally, here's what we want to do. We want to -- again, in our approach to put customers first, we really do want to provide in the West to Western consumers an additional fiber option, particularly for those customers who want to buy more than one product from us. That remains our goal. Not much has happened with respect to execution against that goal, and that's because we're having difficulty getting an appropriate level of service from the fiber operator out West. And -- I mean, not to get into too much gory detail on this. I mean, some of the service windows or install windows are frankly weeks long, significantly longer than what we provide to resellers on our fiber network in the East, and that's untenable, particularly when we think that consumers out West are deserving or as deserving as competition as consumers everywhere else.

ARPUs are higher for Internet in the West than they are in the East. So you could easily argue that consumers in the West are perhaps even more deserving of more competition. So what we're looking for is just an appropriate level of service from the underlying network owner out West. And once we -- once that's delivered to us, we'll be able to execute against what we said at Investor Day.

And are you seeing higher reseller activity in your region?

That's traditionally been the case. There's always been more resell for years and years and years in the East than in the West, and that's because the regulatory rules were actually always, for some reason, asymmetrical until recently, where there was no fiber mandate in the West, but there was a fiber resell mandate in the East. It's a bit inexplicable, but it's what it is. Those rules have changed now so that there's a fiber resell mandate across the country, but we just need appropriate service delivery so that we can deliver an experience to customers out West that they would expect of us and that we want to deliver because, again, all this -- put all of this aside, what matters the most is the experience that we deliver to customers. That's what concerns me the absolute most.

Our next question is from Matthew Griffiths from Bank of America.

I just wanted to ask on guidance. Coming out of the Investor Day, I think the message, and correct me if I'm wrong, was for within that 3-year guidance window for EBITDA growth to be sequentially higher in each subsequent year. Is that still the case as we get -- as we see 2026 guidance in the context of the 3-year guide?

Matthew, it's Curtis. Yes, nothing's changed our view there. We expect as our growth businesses ramp up, as Ziply Fiber continues to expand their footprint and drive penetration, as our AI-powered solutions businesses ramp up, we continue to expect EBITDA to progressively improve over that 3-year horizon.

Okay. And so within the guidance range for 2024 -- sorry, of 0% to 4% for 2026, it would seem at the high end of that range, given the ranges that you have longer term, it implies a downward trajectory on subsequent year growth. Can you just help kind of bridge those 2 together? And maybe there's something lumpy that could fall into 2026 that might fall into 2027? I don't know what it could be, but just kind of reconcile those things, would be helpful.

Yes. It's a fair question, Matthew. And look, the trend is upward, but it's not a linear path. As Mirko talked about earlier, there are timing fluctuations in terms of -- especially in our enterprise side of the world, there's a timing impact in terms of advertising continued rebound, launches of our services. So yes, on a 3-year horizon, it's a continuous upward trend. But within any reporting period, there's still going to be a range of outcomes. But the first point still holds true.

Okay. That's helpful. And then, you made some comments on wireless ARPU, which are helpful. I just was curious if you would make -- like what you would say your assumptions are around kind of international roaming as a contributor to either continued declines or stability? Because in the past, you've made some comments on where your monthly recurring revenues have been trending, which has been positive. So anything to add there would be helpful.

Yes. So roaming trends actually improved sequentially in Q4. It was still a decline, but it was a low single-digit decline. So we saw a healthy recovery in consumer roaming revenue in Q4, which is, I'd say, encouraging for future ARPU performance if that continues to hold.

There are no further questions registered at this time. I would now like to turn the meeting over to Mr. Somers.

Thank you, Matthew. Thank you again, everyone, for your participation on the call this morning. Richard and I will be available throughout the day for follow-up questions or clarifications. Thanks again, and have a great day.

Thanks, everyone. Have a good day.

Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.

Great. Thanks, everyone, for joining. I'm Batya Levi from the communications team at UBS. And our next speaker is Mirko Bibic, President and CEO of BCE. Thank you so much for being with us.

Good morning, Batya.

Michael, I thought that we would maybe start with kind of setting up your main -- talking about your main priorities as we head into next year?

Great. Thank you. So actually, there's nothing -- there are no secrets here in terms of our priorities. We had an Investor Day in October, and we laid out what we plan to do over the next 3 years from '26 all the way through '28. And if I can summarize it in a nutshell, clearly, we spent 2025 really focused on strengthening the balance sheet. So strengthen the balance sheet that came with a dividend reset. We're really hyper focused on deleveraging and driving sustainable free cash flow growth and optimizing the cost of capital. So broadly speaking, from a capital markets perspective, the goal is to deliver total shareholder return. At the same time, as we kind of strengthen the balance sheet with all those elements, we have basically redesigned the growth platform for BCE for the years ahead.

So a completely different company with a new momentum and a lot of energy, and we're hyper focused on 4 key priorities, which is putting the customer first, but which everyone does say, but really leaning into it and delivering, and you're going to see it in things like churn improvement. So really walking the talk on that, building the -- delivering the best fiber and wireless networks would be the second.

The third is leading an enterprise with AI-powered solutions. We have such a strong enterprise platform in Canada that has been underappreciated, and we haven't talked about it enough, and it's poised for growth, which is super exciting.

And the fourth priority is building a digital media and content powerhouse and a word on that. We have owned Bell Media for many, many, many years. It was a traditional broadcaster, the largest broadcaster in Canada. And since 2020, we've been hard at work repositioning Bell Media to be from a traditional broadcaster to a digital media and content player. So everything we think about is digital. And we've now turned that asset around where it's expected to deliver positive revenue and EBITDA growth year after year. So those are the 4 priorities. So it's strengthening the balance sheet, the capital market strategy I talked about, and it's hyper focused on those 4 core priorities and making sure we fund that growth.

Okay. Great. So let's dig in those segments. Maybe starting with the wireless. A few years ago, we saw some heightened competitive intensity. In the U.S., the carriers used to say, let's look up north and it was like implement that more rational competitive environment, and it went the other way. But now there seems to be a little bit more emphasis on still competitive, obviously, but maybe a bit more rationality. How would you characterize maybe just recent trends? Are we right that we're seeing a little bit better promotional environment in Canada?

So I think -- well, the answer to that is yes, and let me back up. I love the way you put the question, which was in the past, carriers, investors in the U.S. would look up north. And we -- the Canadian wireless industry for years and years is always a great place to invest. There was some turbulence in the past 2, 3 years with the entry of a fourth national player. I'd say we're back. We're on the verge of being back. So I would kind of lean in and say, look at Canada again in wireless because it's going to be a good place to invest again. And why do I say that? And we've been signaling since, I would say, mid-Q2 of this year that we were starting to see some positive momentum in the wireless industry.

And if we just take the recent past, the recent few weeks as you mentioned Black Friday as a proof point. If you compare Black Friday in Canada in wireless this year to last year, kind of the promotion started later. They ended earlier. And the rate of cash discounting was significantly better this year and pricing has been higher this year compared to last year as well on kind of the monthly service charge and all while delivering -- continuing to deliver significant value to subscribers, which I think is a very important point. And then within that context, you've got Bell Mobility, and we've got -- we've got tremendous upside. We have done an amazing job reducing our churn. We were -- we had the highest churn, and we're working really hard at reducing it. And you can see quarter after quarter, our churn is improving.

Our product intensity is increasing. So the number of bundled households we have, and we've really been hyper focused on getting customers on the Bell brand, which is the premium brand where we bundle customers. So there's a more higher lifetime value on the Bell brand. So from a macro perspective, a lot better and our performance has been good, and it's going to continue to be good.

That's good to hear. In terms of maybe one macro dynamic is slower integration, slower subscriber growth. Are we starting to lap that where you see maybe more stable trends going forward?

So I think that is the good news. If you compare the back half of 2024 and certainly the entirety of 2025 in terms of market growth, it's been significantly less than kind of in that immediately post-COVID, where Canada's population growth increased dramatically in '22, '23 and kind of the first part of 2024. That has subsided quite a bit. So back half of '24 and all of '25, we were adjusting to and lapping very high rates of market growth. The market is still growing. It's just growing less than it did a few years ago. And as I look into 2026, it's going to continue to grow, and it's going to grow probably similar to this year.

So we are lapping -- like we've lapped that headwind now. And from a general economy perspective, I think the economy in Canada is going to probably stay more or less stable in '26 as it has been more or less stable in 2025. So we've got that stability, and we've got market growth stability. So I think that's another positive proof point.

And what's driving the churn improvement?

It's a multifaceted approach. So first of all, I mentioned in the first question, really putting our -- walking the talk on customer experience. We are -- we've done a lot of work that no one's seen cleaning up, call it, the back end of the legacy systems. And essentially, in a nutshell, equipping our people with the tools they need to better serve customers. That would be one. We've also equipped our customers with the tools they need to serve themselves. whether that's a virtual repair tool, better online sales. We've got AI, virtual -- AI-powered virtual agents to help mediate issues. So that customer experience is dramatically better. That's one.

Two is we've spent more time, significantly more time focused on increasing the number of households who buy multiple products from us. So increasing that bundled household. Back in 2020, we were materially gap to our competitors. We've narrowed that gap. In Canada, convergence has shifted not only from mobility and Internet to mobility Internet and content, and we've got a significant advantage there on content. If you think about that converged 3-product bundle, we're in a great spot. We have the most fiber households of anybody with fiber is the best broadband technology you can buy. We've got a national wireless network, and we've got a tremendous 5G, 5G plus network, owner economics on wireless, owner economics on fiber, and we own the #1 sports service available streaming.

And we have -- we are the only Canadian -- we're the only Canadian operator with a premium content streaming platform called Crave. So we have economics on content. And we've been driving customers to multiproduct on the Bell brand. So we also have great distribution and tremendous trust in the Bell brand. So you put all those together with a focus on execution, we just kind of basically put our shoulder to the wheel and get it done.

And within that, is there also maybe allocation of spending to retain the base? Is that also helping?

We have also -- we were gap to our competitors, we believe, in the recent past on the number of subscribers that we've recontracted. And if we look in kind of the recent performance, we've had a stellar -- if you look at our customer -- or the customers that basically our net add growth in the last few quarters, high preponderance on the Bell brand. We like our sales mix. We've got a higher proportion of contracted customers compared to bring your own device customers or noncontracted customers compared to the past. So we have put a lot of focus on that, too.

Okay. And something that we saw in the U.S. is that continuous price up led to higher churn. And in Canada, we just started to see some stable pricing and even maybe some increases of the front book. Do you think that those are sustainable? Or do you worry that, that could increase churn when you had started to see just some improvement flow through?

Well, I -- again, I feel very good about that, too. So if you -- there have been some price ups, but we needed some price ups. But if you compare the level of pricing today in the market compared to 5 years ago, it's 50% less at a basket level, at a macro level. So there's significant and better networks. So the consumer in Canada is getting significant value. I think we're getting to a better equilibrium in terms of the value that we deliver and the price that we secure for the value we deliver. So -- and then the entire market has moved up a bit. So I think from a pricing point of view, there's not kind of one provider who's standing out, except maybe the fourth provider that has a little bit of pricing room there. So it really is around driving better execution across the key touch points that the customers are looking for, price, trust in the provider, better customer experience, better networks, content.

So along -- putting all of those together in terms of -- everybody is focused on your ARPU trends. It had been sort of declining but at a growing rate. And now we've just started to see potentially some improvement going forward. Can that be sustained? And can ARPU grow?

Yes. So we see the possibility of ARPU growth in the back half of next year. So I'll lead with the punchline on that, which is important. I think if you're looking at pricing generally, if you -- ARPU is composed of several elements, one of the key components of ARPU is the monthly service charge. And the monthly service component of ARPU that we are securing today from new customers is higher than the monthly service component of ARPU in our base of customers. So that's a really positive development. And then we're more than halfway through the repricing of the back book, which is another good touch point. And as far as Bell is concerned, in particular, the drive that we have and the focus that we have on multiproduct households, which are -- we only have now one brand that offers multiproduct, which is Bell.

So we're driving higher value customers on the Bell brand across multiple products, which is driving lifetime value and significantly higher lifetime value than for the average customer. So that's also a really positive development as you look at churn in wireline, churn in wireless and then ARPU growth in wireless and ARPU growth in wireline and ultimately, lifetime value.

And I think within wireless, you've also mentioned that it's nice to have subscriber growth but profitable subscriber growth. Right now, the environment seems to be manageable. But can you talk about kind of like where you would draw the line in terms of promotional activity and let go subscribers? What is more important as you head out next year or through your 3-year plan?

So the most important thing is going back to the very first question, we want to drive sustainable free cash flow growth for our investors. That's clearly -- if you just go back to Investor Day on October 14, title of the whole day was driving sustainable free cash flow growth. You do that by driving revenue growth and EBITDA growth and ultimately managing your CapEx, funding the right things, and that's how you're going to get your free cash flow growth at the 15% CAGR levels that we want. So if you start with that's the primary objective and walk -- walk back from there, clearly, we need to grow the platform. We want to have wireless is such a big component of our business. We want to grow our subscriber base, but ARPU accretive customers with higher lifetime value. That's the objective.

So it's not -- we sit there -- when we look at a quarter, we're not saying the win for us is winning net add market share in that quarter. It's getting the best customers that are ultimately over time, going to allow us to execute against that 3-year road map we provided to shareholders because now it's all transparent. Everyone knows what we're trying to drive from a financial perspective. So every move we make tactically is designed to do that. So clearly, we want to grow our net adds, and we will and we have been. But it's on the Bell brand, multiproduct, ARPU accretive lifetime value.

Okay. And on the convergence and multiproduct, what converged bundle provides more improvement on the churn side? Is it the fixed wireless one or wireless maybe fixed and DTC, which one does better? Or does it matter for you?

Well, the more products you have, the lower your churn and the higher lifetime value. So it's -- ideally for us, the sweet spot is a wireless customer on the highest tier combined with fiber on Internet and hopefully kind of 3 gigs, 1.5 gigs, 3 gigs, potentially higher and content. And what -- the highest ARPU on content is the full-fledged 5 TV service with the biggest content packages, but the streaming packages we offer highly accretive as well.

The highest base of converged customers we have are mobility and Internet, but Canada is migrating to mobility, Internet and content. So kind of at a general level, mobility, Internet and content is where we want to go, and we have some pretty high growth objectives on those bundled customers that we've outlined at Investor Day, but mobility and Internet is also important.

Okay. And can you talk a little bit about beyond improvements in churn, what other opportunities do you get when you bundle the product?

So it's again, it's the overall lifetime value. And so for us, it's when we bundle a customer, we automatically get them on the Bell brand, which is what we want to do. So like you get offer simplification because all our multiproduct offers are on the Bell brand. So you lower your cost, you lower your cost, you retain the customer longer, which is obviously the churn component, your lifetime value goes up. And then you get to -- once you've got the customer, you get to migrate them to more content or a higher tier of mobility or a higher speed tier on fiber.

Are there opportunities in terms of integrating all the different cost buckets when you are serving a multiproduct customer?

Yes. And we've done that. So we've done a lot of work in the background simplifying our kind of our service delivery. We used to have 5 years ago, we used to have a call center queue for a call center operation for mobility, a call center operation for wireline and then you'd have the transfers. Now we have household queues as an example, that drives a lot of costs out.

We've got the ability to mediate customer interactions digitally with virtual agents, both chat and voice assisted across all the services in unison. So that takes a lot of cost out of the business. Of course, the more fiber you have and the more customers you have on fiber, your costs are automatically going to go down, both in terms of truck rolls with self-install, virtual repair, lower truck roll. So it all goes together end-to-end. It's an end-to-end approach to service delivery.

Got it. And what about competitive intensity in broadband? Is that getting any better?

Actually, it is. And then we saw -- we're seeing some stability there in certain key provinces in Ontario, in particular, which is the most populous province in the country where we have the largest number of fiber locations, we've seen pricing stabilize. Quebec is the second largest province where we have the second highest fiber locations, and we've seen broadband pricing by and large, if you look over a 12-month period, stabilize there as well. So we're feeling good on that front also.

You have been the challenger mostly in Quebec.

We -- until this year, we had been the challenger. And there's a reason for that. So in terms of -- we've had fiber in Atlantic Canada since 2008 and our performance has been stellar. And in Ontario, our performance has been very strong as well. In Quebec, we had kind of a significant amount of fiber. In fact, it's the other than Atlantic Canada, where we started our fiber build, yet we saw our kind of penetration had stagnated. And I was not pleased with the fact that we invested so much capital building the best network, and we were growing our market share, but not commensurate with the market share growth that we saw in other areas where we had fiber.

And as we lowered price, we saw -- there's a lot of legacy reasons for this that we had to overcome, which we can get into at some other time perhaps. But we saw with kind of adjusting our price, we saw our market share skyrocket. So we went from low 30s to low 40s in penetration and market share. And -- but that has an impact when you're the price challenger. And now that we've got our market share in a more reasonable place, we've pulled back on the pricing lever somewhat. And I think that's why I can say in answer to your first question, we have seen stability.

Right. And in terms of your penetration goals where you have fiber, where do you think that could sort of get to and stay at a run rate?

I guess I'll go back to Atlantic Canada. So again, Atlantic Canada, we have tremendous fiber coverage, just a small number of -- the population is relatively small compared to some other parts of Canada, but we have very high fiber penetration, had it for quite a bit of time and both our market share and penetration has punched well above 50%. So when you've got the superior technology...

Specially with multiproduct?

In multiproduct, you got the superior broadband technology. Broadband is so critical to consumers. And the capacity needs and the quality needs will not diminish over time. And so I think we're -- and fiber is going to remain the superior technology for a long time. I think cable, just as a general comment, cable infrastructure has got to -- cable operators have a lot of work to do, a lot of work to do to keep up with consumer needs, bandwidth needs and to keep up with the competition. So we're in a good spot.

And we have more than -- important point for those who may not know Canada as well as you do the U.S., we have more than twice as many fiber locations as any other provider and nowhere that we operate is there another fiber operator. So we are the only fiber operator where we are, where we offer service and have more than twice as many as the nearest fiber competitor in Canada.

Right. And -- but I think your plans are kind of like getting to that 8 million fiber homes passed and not necessarily build beyond that.

So we had a target. We outlined a target in 2021 to get to the target to get to 8 million. We will be at 8 million by the end of this year, which is in 2, 3 weeks. And then we're not going to stop. We're just going to significantly reduce the pace of build. So we're going to think about it as a baseline build. There are new housing starts in Canada, like they are everywhere else every year. So new housing starts in our operating territory, we will build fiber too. We have some subsidy builds that provincial and federal governments have subsidized some broadband builds in rural areas. We've contracted to do a lot of those, and we're going to continue to fulfill our commitments over the next 2, 3 years. So we'll do that as well.

And we've got some black holes, some MDUs in urban areas that we want to continue. So that's what we're going to do as the baseline build, which is significantly less than recent years. And we're going to drive fiber growth in the U.S. through Ziply Fiber.

Right. Before we get to the U.S., fixed wireless in Canada, I think you reached -- you have about -- a little bit over 1 million passings. How do you envision utilizing that product going forward?

The short answer -- and I don't mean to be flippant, but the short answer is fiber wins. Fiber just wins and fixed wireless access does not compete or come anywhere close to competing with fiber and actually doesn't compete very well in Canada anyway against Tier 1 cable. And that's been our experience. And there's a lot of talk in the U.S. about fixed wireless access, probably the known fact south of the border is we were the first to launch fixed wireless access at scale. So in 2018, we launched our offering to 1 million locations passed. And I mean it does well where there's no other option, and it does well against Tier 2 cable nothing competes with fiber.

Okay. U.S. So it was an interesting move on your part, I thought getting into U.S., but also having some ambitious plans to keep the fiber deployment going. It seems a bit of a land grab right now. Everybody -- I mean, a lot of the incumbent telcos and private companies are looking to build fiber. Are there that many opportunities to build fiber in the U.S. in an economic way?

Right. So if I take a step back, just because you said surprising at the time it was announced. But if I take a step back, we are -- we become a fiber-first company. That's what we do, and we do it really well. And as we were getting to the end of our 8 million locations passed target that we just talked about, we said, okay, we're not going to -- we want to continue to drive growth with fiber because that's what we do. So where is the opportunity? Is the opportunity to continue to push as aggressively in Canada? Or is there a better opportunity in the U.S. And now that we've got 8 million locations passed in Canada, the incremental build is higher cost to build than the initial 8 million. And there's such an opportunity in the U.S.

There's so much less fiber availability here than there is in Canada, and the cost to build is very attractive. And so that was kind of the strategic rationale behind the Ziply Fiber play. Now in terms of our expansion opportunity, we're at 1.4 million fiber locations passed in the Pacific Northwest. And we have a goal to get to close to 3 million by 2028 with a longer-range ambition of 8 million. There are a lot of households in the U.S. that don't have fiber significantly more than 8 million. So we've mapped out the opportunity, and we believe we can get to the 8 million. But what's important is the business -- it's not like the investment case turns on 8 million. It's just a growth opportunity. If we get to 5.5 million, that's a tremendous growth opportunity. If we get to 6.2 million, that's a tremendous growth opportunity.

But we have line of sight to 8 million, and that's what we're going to do. And when we go back to -- again, back to the very first question you asked me, and I say one of our key objectives is to optimize the cost of capital. We have a funding partner in the U.S. to help us fund the build and therefore, drive the growth that we want to secure. And that's with PSP, which is the Canadian Public Sector Pension fund.

In terms of cost to build, as you think about maybe the next million and the next million, how are you thinking about the cost to build to evolve? I think we saw some cherry picking and initial maybe 50% of the U.S. has been built roughly $1,000 per home or maybe a little bit above. But isn't the next cohort going to cost more?

We think that in the large majority of the 8 million that we've mapped out will be -- we're anchored to -- I'll tell you what the key variables are for us. We're anchored to that $1,000 per line pass, give or take, a little bit because we appreciate it. We do understand that over the next couple of years, there will be general CPI or inflation. So -- but we're anchored to that $1,000. We're also anchored to the concept that we are going to choose locations where we're the first to fiber. So key things. Cost to build, first to fiber. And then even with those key variables, we see line of sight to that 8 million over time. But again, 6 million, there'll be amazing growth for Ziply Fiber.

Is convergence important to get that fiber growth in the U.S.?

Well, it's -- we're going to build first and then the key thing is penetrate the fiber plant that we're going to build. We've seen -- we've compared Ziply Fiber penetration gains where they've launched fiber in their current footprint to BCE's fiber penetration gains where we've launched fiber, and we've been building fiber since 2008. So we have 18 years of -- 17 years of experience with fiber. Ziply Fiber's penetration gains after 6 months, 1 year, 3 years, 5 years is very, very close, basically sits on top of our lengthy experience. And this has been done in the kind of the last 4 years by Ziply Fiber without a wireless offering. So they've not been slowed down at all.

So we're going to get the penetration gains that we expect in the investment case without a wireless offering. But here's what we think is going to happen. At some point, we'll hit that kind of a certain penetration plateau, which I think will be in the 40 to mid-40s. And we may need at that point in time, a wireless offering to get to the next plateau of penetration gain. So I fully expect that over time, we will have a wireless offering, and we've got a lot of options there. And the Ziply Fiber management team was planning for this before they became part of the BCE family in any event.

Because it seems like the U.S. is changing. Cable is losing momentum, fiber, fixed wireless taking share and convergence is also part of the play. And frankly, right now, we don't have that much pricing power in the U.S. when cable is looking to improve volumes. How do you think you can balance both? Like do you think that you would need maybe wireless convergence earlier than planned? And do you think that you can continue to improve pricing here? Can you see price up in the U.S.?

So interesting, Ziply, the secret to Ziply's success to date. And I mean it's a really interesting story. It basically took a legacy asset that was dramatically underperforming which was part of Frontier, acquired it in 2020 as part of kind of right before the Frontier restructuring and the team of founding management set about completely turning that asset around to become a fiber-first operator. So #1, it's all fiber. There's a little bit more of legacy copper upgrade to do, but significant fiber, completely, fully modernize their IT stack. Their NPS numbers, no matter how you measure them, service sales, transactional relational through the roof, their NPS numbers like I've never seen before. So customer-first culture, fiber, completely modernize the IT infrastructure. In fact, up to now, their pricing has been a little bit lower than cable and it's delivered tremendous results.

So as we look forward, we're just going to continue leaning on those key ingredients. And when you -- the management team -- I mean, I'm proud of the following thing I'm going to say, the management team has stayed with BCE post-acquisition. And they've done it because they're energized about what we want to do. With BCE now as being part of the BCE family, we have a plan to accelerate the base case build that they had before. So we were able to do what they wanted to do faster. And now we're also expanding beyond the 4 core states, which wasn't in their base case plan. So we're accelerating and expanding. And now you've got BCE, which has deep expertise in fiber with a local management team with deep expertise in fiber and then you've got the capital [ VC ] and PSP behind the push. So it's a great story for them.

Okay. Going back to Canada. When you gave your 3-year outlook, one part that we weren't very comfortable with is the expectations for enterprise revenue growth to accelerate to 2% to 4%. Can you talk a little bit about kind of new initiatives, but it also carries a lot of legacy revenues that have been declining for some time. How do you make that transition in an accretive way? And I think we hear from multiple telecom operators that enterprise and new opportunities, AI-driven solutions is key. Everybody seems to be the winner. But who is actually going to win? Just your approach to how you can turn enterprise.

That's a great question. And we are very excited about the potential of Bell Business Markets, which is our Enterprise division. It is an underappreciated jewel in the BCE story. So let's take a step back. We have $5 billion -- roughly $5 billion in revenues today, the vast majority of it being in what you would consider the core communication services that we've been delivering to enterprises for 145 years, right? And I think what's unique about us, and if you just look at our more recent traditional rate of decline in core communications because basically every telco has been declining in core enterprise. Just really look at our rate of decline -- well, we weren't sharing all these numbers in the past, but I will tell you that our rate of decline was very modest in the recent past and significantly better than the performance of other kind of large cap telcos who have big enterprise businesses.

So we've been managing the decline really, really well, but now we have a plan to turn the core communications business in enterprise to flat and a little bit of growth. And it comes back to, again, execution, just delivering -- modernizing the back end so we can deliver better service to customers. I can go on for half an hour on this, but I'll just leave it there. It is providing network on-demand services. It is offering new modernized versions of communications. So Unified Communications as a Service. For example, we have an exclusive partnership with Zoom, where we offer Bell Zoom Workplace or workplace by Bell Zoom. These are the kinds of things we're doing to modernize the suite of services in core. And we're going to turn that modestly negative to flat to slight growth.

Then on the -- we have 3 growth verticals now as well, and you mentioned them in terms of kind of the AI vector. So we have 3 newly launched businesses this year. One is cyber. Another one is Ateko, which is -- think about it as a systems integrator that's hyper focused on AI automation. So it helps enterprises with their cloud infrastructure, Azure, Google Cloud and AWS as well as ServiceNow and Salesforce, hyper focused on only those things. And the differentiator for Ateko is all that work I described, all the expertise, they do it for Bell. As we've modernized ourselves, Ateko has been a key ingredient to that. So all that experience then gets brought to our third-party customers.

And we have Bell AI Fabric, which is a national ecosystem of purpose-built AI data centers. And what's really key here in terms of who's going to win is 95 of the top 100 enterprises in Canada do business with Bell and have done business with Bell for years and decades. And we are the most trusted -- frankly, we're one of the most trusted brands in the Canadian economy. So we have deep enterprise relationships, the best network and a hyper-focused suite of AI solutions that we're seeing organically grow quarter after quarter. By the way, in terms of who's going to win? Well, there's a lot of room, right? The addressable market is massive. And it's not going to be a winner-take-all kind of thing. There is a lot of growth there for us to secure despite the fact that there's going to be -- many players are going to try to take their kind of anchor down in certain corners of the space.

That's great. We're out of time, but one final question on capital allocation. We heard during the investor meeting your target leverage, CapEx needs -- CapEx requirements and investments. Maybe just help us how would you prioritize all the capital allocation needs over the next 3 years? And within that, one pushback comes through lease payment reduction is a part of that 16% free cash flow growth. How do you achieve that?

Yes. So maybe some open the aperture here. So we want to get to 3.5x leverage by 2027, and we will. We're going to deliver at least CAD 5 billion in total dividend payments between now and 2028. Our capital in terms of our CapEx budget, we expect in absolute dollars to remain flat in '26, '27, '28, which means that as our revenue grows, our capital intensity ratio will come down. You've got kind of flat CapEx, but your revenue is growing. So we'll be in the 15%-ish this year, probably 14.5% next year, then lower than that in '27 and '28. And again, it's the focus on where we allocate those dollars is going to be against the 4 priorities I mentioned at the very beginning, customer service improvements, wireless network improvements, more fiber, Canada, U.S. investing in the right spaces in AI and then in digital media.

Those are where the investments are going to be and the ones that drive the highest returns, the programs, projects, investments in those core priorities that drive the highest returns are what is going to get funded. And on capital lease repayments, yes, they are going to come down over that 3-year horizon. So we're going to be delivering 7% free cash flow growth, the way we've traditionally defined free cash flow and 15% CAGR after capital lease repayments.

Okay. Great. We'll stop it there. Thank you so much.

Good morning, ladies and gentlemen. Welcome to the BCE Q3 2025 Results Conference Call. I would now like to turn the meeting over to Chris Summers. Please go ahead, Mr. Summers.

Thank you. Good morning, everyone, and thank you for joining our call. With me here today are Mirko Bibic, BCE's President and CEO; and our CFO, Curtis Millen. You can find all our Q3 disclosure documents on the Investor Relations page in the BCE website, and this was posted earlier this morning.

Now before we begin, I would like to draw your attention to our safe harbor statement on Slide 2, reminding you that today's slide presentation and remarks made during the call will include forward-looking information, and therefore, are subject to risks and uncertainties.

Results could differ materially. We disclaim any obligation to update forward-looking statements, except as required by law. Please refer to our publicly filed documents for more details on assumptions and risks. Now with that out of the way, I'll turn the call over to Mirko.

Thank you, Chris, and good morning, everyone. Last month at our Investor Day, we unveiled an ambitious and exciting 3-year strategic plan, which positions Bell for the future.

This includes clear and transparent financial targets to drive long-term shareholder value and a refreshed brand that better reflects the full breadth of our customer segments. We also took the opportunity to introduce our investors to several members of the executive team and conducted deep dives into each of our operating businesses.

As we execute against this plan, we're leveraging our proven ability to drive efficiencies in order to generate strong, sustainable free cash flow growth and total shareholder return, and that's supported by a disciplined capital allocation strategy.

Earlier this year, I shared our intent to focus on 4 strategic priorities, all underpinned by our unique and highly differentiated assets in fiber, in wireless, in media and enterprise. And in Q3, we continue to execute diligently against all four of those strategic priorities, and you can see this in our results.

I'll start first with the customer. We have a reenergized focus on customer service, and it's really paying off. Thanks to the investments we've made, we reported a second straight quarter of significant postpaid churn reduction, and this is the direct result of customer service improvements, increased product intensity and effective real-time retention offers.

A few weeks ago, we launched new wireless plan tiers, each offering distinct value propositions. This innovative approach moves beyond traditional data bucket sizes, introducing differentiation based on network speeds and video quality, roaming and long-distance features, varying levels of device discounts and content offerings. The response from our customers has been very positive. This construct gives customers more choice and it reduces churn, all while leveraging our owner economics and content.

Our premium Bell branded postpaid wireless loadings are significantly higher than our consolidated reported postpaid net adds with Bell brand postpaid year-over-year growth exceeding 100%. This is a clear indicator of strong customer demand and the strength of the Bell brand in the market and it's completely on strategy. We're also continuing to make meaningful progress on transforming the customer experience with initiatives like the AI-powered virtual assistant that we showcased on October 14.

This as well as other AI-driven applications serves as a technological foundation for a next-gen customer experience. I'll move now to delivering the best fiber and wireless networks. As you know, for well over 100 years, Bell has built and operated the best networks in the country. And now we also have one of the best network growth engines in the U.S. with Ziply Fiber.

This was our first quarter of operating this asset and its results are reported in our new Bell CTS U.S. segment. We're very pleased that Ziply Fiber's financial results continue to exceed our original investment case. Again, as you saw on October 14, Harold and his team are engaged and excited by the tremendous opportunity ahead. With the formation of the Network FiberCo partnership now complete, Ziply is well positioned to accelerate its fiber build and expand beyond its current 4-state footprint. Construction is set to ramp through 2026.

Currently, Ziply's fiber network passes 1.4 million homes in the U.S., and we expect to reach approximately 3 million locations by the end of '28. Over time, we intend to leverage the Network FiberCo partnership to expand our U.S. fiber footprint to 8 million locations, and we'll do that in a cost-efficient manner. Including our U.S. operations, we added 65,000 net new fiber subscribers this quarter.

In Canada, fiber continues to be a key driver of multiproduct penetration through mobility and Internet and content cross-sell opportunities. We're focused on increasing the number of subscription services per household with content bundling playing a central role in that strategy.

In Q3, product intensity was up approximately 7% year-over-year, fueled by growth in content subscriptions. And as we shared at Investor Day, we plan to increase product intensity in the next 3 years by approximately 25%. So we're off to a good start. Our fiber advantage will grow with the availability of Wi-Fi 7 and Wi-Fi 7 works best on fiber. And again, it's going to improve the product intensity momentum.

Turning to wireless. The environment has stabilized, and we expect this trend to continue. Wireless service revenue and ARPU both declined by less than 0.5 percentage point, while postpaid churn improved by 15 basis points. We also recently announced a partnership with AST SpaceMobile to deliver direct-to-sell satellite service. This breakthrough technology will expand our network reach, bridging the gap between the terrestrial 4G and 5G networks and Canada's most geographically challenging areas using powerful and reliable low-band spectrum. initial launch of our service is scheduled for late 2026.

The service will include voice, video, text and broadband data capabilities using base stations owned and operated by Bell within Canadian borders, and it will be accessible with an ordinary smartphone. The partnership with AST will enhance network reliability, resiliency and security for all those choosing Bell.

Turning now to enterprise and leading with AI-powered solutions. We all know that the Canadian economy is changing, our industry is changing and technology is advancing at an unprecedented pace. The AI revolution is in full swing and it has the potential to change how we work, how we live and how we connect.

At the same time, global instability is rising and Canada and other countries are reassessing long-standing relationships that, in some cases, seem far less solid than they once were. Against this backdrop, as we've been sharing, we've reshaped our strategy, and we're well positioned for growth in this new environment.

In just the past year, we've launched the three game-changing AI-powered solutions businesses, and they're all foundational to our long-term growth strategy. And that's Ateko, Bell Cyber and Bell AI Fabric. Each of these businesses is expected to deliver significant top line and bottom line growth as we execute against our 3-year strategic plan. I'm pleased to report that revenue from AI-powered solutions grew 34% year-over-year.

Most of that's organic growth, and it's a strong validation of our strategy. Canada is having its AI moment, and it will be distinctly sovereign. According to a recent survey by the Harris Poll commissioned by Bell, 75% of large Canadian businesses consider AI to be a strategic enterprise-wide priority with 91% of them prioritizing data sovereignty. This is where Bell holds a clear advantage.

Bell's AI fabric is precisely engineered to meet these exact needs. Our purpose-built AI data center business and the full stack AI alliance we've assembled with other Canadian tech leaders continues to have a deep pipeline of interest, and we expect to announce more growth in this space in the coming months.

The public and private sector share a fundamental role in building Canada's sovereign AI ecosystem and the renewed commitment to AI that we saw this week in Budget 2025 is an important step forward that will support adoption, strengthen the economy and help Canada compete globally. I'll turn now to the fourth strategic priority, which is building a digital media and content powerhouse. We recently introduced our new streaming bundles for Bell Mobility and Internet customers, and that features Crave, Netflix and Disney+ together all in one bundle.

Our commitment to sports content also remains strong. We announced long-term broadcast and streaming rights extensions for regional coverage of both the Montreal Canadians and the Winnipeg Jets, and that reinforces our leadership in Canadian sports media. We're also continuing to ramp our digital media capabilities.

Our long-term partnership with iHeartMedia was expanded this quarter to include Canadian representation of iHeartRadio's extensive podcast portfolio, significantly enhancing our digital audio offering.

Additionally, we entered into a strategic ad distribution partnership with Tubi, one of the largest and fastest-growing free streaming platforms in Canada. All in, these initiatives will create new opportunities for digital advertisers to reach Canadian audiences across Bell Media's audio and video platforms. So in short, we're executing with discipline, and we have momentum across all 4 of our strategic priorities.

This focused path will continue, positioning us to deliver long-term sustainable free cash flow growth and enhanced shareholder value. As shown at our Investor Day, we have a highly coordinated and energized company that's fully aligned and ready to continue to execute.

With that, I'll now turn it over to you, Curtis, for a review of our Q3 financial results.

Thank you, Mirko, and good morning, everyone. I'll begin on Slide 7 with BCE's consolidated financial results. Total revenue was up 1.3%, driven by the acquisition of Ziply Fiber completed on August 1.

Ziply Fiber's operating results are reflected in our new Bell CTS U.S. segment, while the Canadian wireless and wireline operations are reported under Bell CTS Canada. Overall top line growth was moderated by retroactive revenue adjustments at Bell Media related to contract renewals with certain Canadian TV distributors in Q3 of '24.

Adjusted EBITDA increased by 1.5%, also reflecting the contribution from Ziply Fiber. This led to a 10 basis point margin increase of 45.7%, our strongest result in more than 30 years. Excluding the contribution from Ziply Fiber and normalizing for the aforementioned retro benefit of Bell Media last year, overall BC EBITDA grew by 0.4%.

Net earnings and statutory EPS were up significantly over last year. This was largely due to the $5.2 billion gain from the sale of our minority stake in MLSE on July 1 and lower asset impairment charges compared to Q3 of last year. These noncash charges were related to Bell Media's legacy properties to reflect the ongoing digital transition of the advertising ecosystem.

Adjusted EPS was up 5.3%, supported by higher EBITDA. CapEx was down $63 million this quarter, bringing year-to-date CapEx savings to $551 million. We anticipate a year-over-year step-up in overall spending in Q4 as Ziply fiber executes its fiber build-out, consistent with our 2025 capital intensity guidance of approximately 15%. The combination of lower CapEx, higher cash from working capital, lower severance payments and the flow-through of higher EBITDA drove $171 million increase in Q3 free cash flow.

Turning to Bell CTS Canada on Slide 8. Internet revenue was up 2%, solid results showing what's striking a healthy balance between sub growth and disciplined pricing supported by fiber. Our business markets continues to build momentum with strong demand for our unique and differentiated suite of services. We saw sustained strength in AI-powered solutions, where revenue increased 34% year-over-year, driven by rapid growth at Ateko and Bell SIA.

We're excited about the opportunities ahead and remain on track to generate approximately $700 million in AI-powered solutions revenue in 2025. Wireless service revenue declined modestly by 0.4%, in line with the 0.3% decrease in Q2. When normalizing our Q2 results for the nonrecurring revenue benefit related to G7 Summit, Q3 service revenue performance showed notable improvement compared to last quarter. Wireless product revenue was up $41 million this quarter. This year-over-year increase was driven by greater sales of mobile devices.

Our EBITDA result was in line with plan with a notable 10 basis point margin increase over last year to 46.8%. This reflects our continued focus on cost management as evidenced by a 0.6% reduction in operating costs this quarter. Turning to our new Bell CTS U.S. segment, which reflects Ziply Fiber's operations for the 2-month period following the acquisition on August 1.

As a reminder to investors, Bell CTS U.S. financial results are reported under IFRS accounting standards, consistent with Bell's other operating segments. We're pleased to report a strong start, financial results tracking ahead of the expectations we set at the time of announcement.

Total revenue reached $160 million, driven by the strength of Zip's fiber-to-the-prem platform. Internet revenue grew 15% year-over-year, supported by continued expansion of Ziply fiber footprint and strong customer penetration. Bell CTS U.S. delivered $71 million in EBITDA for the period, representing a robust 44.4% margin.

This performance reflects both higher operating revenue and the benefits of Ziply Fiber's efficient cost structure and customer-centric operating model. The impact of Ziply's customer-focused model is evident in higher NPS scores and cost efficiencies. While the customer base continues to grow, customer contact rates are declining, now among the lowest in the U.S. market.

Looking ahead, with continued operational discipline and a significant growth runway, we expect strong EBITDA growth for Bell CTS U.S. over the coming years, in line with the 3-year plan presented at our Investor Day. On the subscriber front, Ziply added 9,000 net new fiber customers in August and September, underscoring the strong momentum in expanding Ziply's fiber customer base.

Notably, fiber now represents 87% of total retail Internet subscribers. Total retail Internet net adds totaled nearly 5,000 subs, which reflects competitive losses in copper areas.

Over to Bell Media on Slide 10. As projected, total revenue was down in Q3, decreasing 6.4% year-over-year. Excluding the onetime retroactive sub fee adjustment in Q3 of last year, the decline was close to 1%. Despite strong digital ad growth, both in video and out-of-home, total advertising revenue was down 11.5%, reflecting continued softness in traditional advertising demand for non-sports programming as well as the impact of the previously announced divestiture of 45 radio stations.

While Crave and sports direct-to-consumer streaming continued to grow, subscriber revenue declined by 5.2%, primarily due to the aforementioned retroactive revenue adjustments we lapped from last year. These adjustments were also a major contributor to the 6.7% decline in Bell Media's EBITDA this quarter. Excluding this onetime item, Q3 EBITDA was up 11.3% year-over-year. We're also pleased that OpEx was down 6.3%, shows you the focus we have on business transformation.

Looking ahead, despite near-term headwinds on linear advertising demand, we remain confident that Bell Media will deliver positive revenue and EBITDA growth for the full year. Our focus remains unchanged for Bell Media to consistently deliver annual revenue and EBITDA growth while contributing meaningful free cash flow to DCE.

Turning to Slide 11. Our balance sheet is very healthy with $3.6 billion of available liquidity and a sizable pension solvency surplus totaling $4.5 billion. Our net debt leverage ratio at the end of Q3 was approximately 3.8x adjusted EBITDA. This reflects the acquisition of Ziply Fiber, which closed on August 1 and was funded using the $4.2 billion in net proceeds from the MLSC sale received in early July, along with cash on hand.

In late August, Ziply Fiber's outstanding debt of $2.7 billion was redeemed, partially funded by the $2 billion public debt issuance we completed earlier in the month. I'd also highlight that BCE's nominal net debt at the end of Q3 was $40 billion, which despite the Ziply Fiber acquisition is lower than the $40.3 billion reported at the end of 2024.

Looking ahead, we remain sharply focused on reducing our leverage ratio to 3.5x by the end of '27 with a clear path towards 3.0 by 2030. We expect to reach these milestones through a combination of organic EBITDA growth, free cash flow generation and near-term monetization of noncore assets.

To conclude on Slide 12, we remain sharply focused on our 4 strategic priorities to drive growth across our key business units, alongside our company-wide transformation to enhance efficiency. With year-to-date consolidated financial results tracking in line with plan, operating momentum across the business and our consistent proven execution in a competitive marketplace, I'm reconfirming all of our financial guidance targets for 2025.

I will now turn the call back over to Chris and the operator to begin Q&A.

Thanks, Curtis. With that, we're ready to take our first question.

The first question is from Vince Valentini from TD Bank.

Can you help us unpack the federal budget a bit? It's still not clear to me these tax breaks for accelerated depreciation. Just could some of that apply to the money you spend on typical CapEx also on the data center front, the dollar commitments from the government, do you take that as they would co-invest in facilities with you, which eases your investment burden or that they actually would be a big customer and spend more on their own needs and do that only with sovereign providers like Bell. Those would be the two main things out of the budget, if you have any comment on the tower siting and sharing fiber builds stuff to -- if you think there's any relevance there? Anything you can tell us would be helpful.

I think as a general comment, Vince, I'd say that at a macro level, the budget is certainly positive in terms of having a number of initiatives industry why I don't mean the telecom industry only, but just generally speaking, spurring more investment in the Canadian economy is a decidedly good thing.

And I think there's a lot of pro-competitive pro-investment initiatives in the budget that should be looked upon favorably. On the capital allowance initiatives, Curtis, I'm sure, will add to what I have to say, but those are always looked upon favorably because I do think they're a direct mechanism to continue to encourage companies to invest.

On the AI side of things, still a lot to unpack there, Vince. So I can't answer your questions specifically just yet until we do more unpacking. But I would say that the initiatives that are outlined in the budget, the upwards of $900 million for sovereign AI and sovereign cloud shows that this government is committed to seizing the AI moment and encouraging AI adoption. And this is where we're at.

We're at the moment in time where we need to move from AI science to industrialization at scale across the Canadian economy using Canadian tech leaders. I think that's the signal you should draw from the budget. So in that regard, it's a good thing. AI infrastructure in Canada by Canadians for Canadians.

And I think we'll be able to capitalize on that in general terms because that's a measure to increase adoption in a sovereign way. So view that as a directional positive for Bell AI Fabric. And with the sovereign AI alliance that we've put together with Bell AI Fabric and Coveo and Cohere and ThinkCon and a number of other Canadian tech leaders, we're in good shape there, and you're going to see some growth at Bell AI Fabric in the quarters to come.

I'll turn it over to Curtis to unpack some of that for you.

Vince. Just on the tax side of it, as Mirko said, it's certainly helpful. I think over the medium term, it's ultimately accelerating a tax shield and a similar proposal to what was instituted in 2018, we will see a benefit of that over time.

I wouldn't expect a benefit in '25 or '26 based on the wording where it qualifies once the budget is actually enacted and given timing of spend, but '27, '28, we would expect a benefit.

I guess you can't quantify that, Curtis, even in ballpark terms?

No, not yet. We've got to work through that, but we'll get back to you with more details when they happen.

Our next question is from Drew McReynolds from RBC.

Just on the, I guess, Internet competitive landscape. Obviously, a lot of focus continues to be on the TPIA regime. So just Mirko or Curtis, can you just provide an update on how you think the competitive environment is evolving here in Eastern Canada?

And maybe an update on whether you started out West with some of your initiatives you've highlighted at your Investor Day. And then just a quick second one on Northwest Hell. Is there an update just in terms of potential timing of getting that deal across the line?

Thanks, Drew. I'll take those. So on -- let's start first with Internet out in the East. I'll emphasize or reinforce what we shared on October 14. So our specific plans, really our approach is going to be twofold. But in the East, number one, it's protect Bell's retail position, and we're going to execute on the integrated strategy that we outlined on October 14, and I summarized today.

And ultimately, our view is that fiber resellers will, on balance, take more share from cable. And so we'll be able to continue to improve our position on the retail side on the Bell brand, while at the same time, driving higher fiber network penetration in the East and typically what happens. And in the West -- so number two, in the West, our focus is going to be, again, as I said on October 14, as Blaik said, I think we're going to protect our mobility base first and foremost. -- and by offering more services in a disciplined way. So it's leaning in on the wireless tiers, using our distribution strength out West, then layering in no set-top box 5 TV or streaming content bundles or both to grow wireless sales out West and lower churn.

And when it's necessary, especially for our highest value customers, we plan to resell fiber Internet. So all in, we'll be more competitive in the West. We have a trial right now, Drew, in Kelowna, and we expect to have a full launch of fiber resell out West in January. But we're going to do all this in a very disciplined way. I think that's an important point to call out.

On Northwestel, the purchasers are still working with the federal government to secure funding. And so we remain actively engaged to close that transaction. It looks like it will more likely be in 2026. But I think given the amount of time this has taken, it's worth saying the following, very important. We want to close the deal for sure. But we're also happy to operate Northwestel and to serve residents in the North. It's a good, healthy, strong asset.

And look, lose or not close, it has a minimal impact on deleveraging. So we weren't disposing of -- trying to dispose of Northwest Tell because of deleveraging. It was for altogether different reasons. Happy to close, but that's what we're still working on doing. That's priority #1.

Our next question is from Jerome Dubreuil from Desjardins Securities.

First one, a very helpful Investor Day a couple of weeks ago. One of the comments we've been receiving is some investors were expecting to see some margin growth down the road. We don't necessarily have a problem with that given the mix shift. I don't know if you can share, but do you expect margin growth on the Canadian telecom business between 2026 and 2028?

Yes. Jerome, it's Curtis. So yes, at Investor Day, we did talk about 25% to 28% revenue, 2% to 4% growth, EBITDA, 2% to 3% growth. So at the high end of revenue, are you looking at margin compression? But ultimately here, what we also announced at Investor Day was our continued focus on operating cost reduction.

So $1.5 billion of cost savings and frankly, more thereafter as we continue to leverage technology and our internal digital transformation. So I think you're going to continue to see a focus on cost containment. As you mentioned, I know your question was Canada specific. Ziply, as we accelerate our footprint with the PSP partnership, those margins will decline over time, but still at a very 44.4% margin starting point for Ziply. So pretty healthy margins all around. Ultimately, in the range of flat margins is more what I would say.

Okay. And on the AI fabric, I would like to maybe dive a bit more into the timing of the impact on your results. So maybe if you can reiterate the level of investment there, the expected financials and returns and the timing of flow-through in earnings.

Yes. So we have -- I'll start and then Chris maybe add what's appropriate. We gave -- we were pretty transparent as to what the growth targets are that we expect on October 14. And what those are based on from an AI fabric perspective is monetizing 73 megawatts of power.

And so the ambition is greater than that, but just I would say that it's more of a conservative growth projection that we gave at Investor Day since it's only about monetizing 73 megawatts, and that's expected to drive $100 million to $150 million of annual EBITDA. So a very solid business, a very strong pipeline of demand. And as I said in my opening remarks, expect to see some announcements in the coming weeks and months that just shows how we're activating the sovereign AI alliance that we've put together.

So very, very positive there. And again, I will reiterate, we said it a couple of times, but it is worth mentioning. So we have 34% year-over-year revenue growth in Q3 in the AI-powered solutions business. The vast majority of that growth is organic, and all of it is at Ateko and Bell Cyber. And in Q3, none of it is Bell AI Fabric. You saw the benefits of AI Fabric in Q2. So there were no new announcements in Q3, and AI Fabric will see some growth, as I said, in the coming weeks and months. So we're really excited about that growth vector.

Our next question is from Maher Yaghi from Scotiabank.

So Mirko, I speak with a few U.S. domiciled data centers with subsidiaries in Canada. And I mean, the view is that whatever they're offering in Canada is sovereign. The reason I'm saying this is, do you think the government is going to formalize what is considered to be sovereign AI to make it very clear to enterprise in Canada what constitutes sovereign AI and what does not constitute sovereign AI because it's kind of like what she said, he said type of thing right now in the marketplace.

Yes. So thanks for that, Meyer. I'll answer it in 2 parts. So there needs to be a very clear understanding and definition of what sovereignty means. And sovereignty isn't just about having a data center located in Canada. That doesn't -- that's not sovereignty.

Sovereignty is a multifaceted thing. It's who has where the data is located, how data moves, who has control over the data, who has control over the action, which is the compute and who has control over the governance, which is who can access everything and who has access to the keys to the technology.

So it's action, movement, storage, governance. So that's one part. The second part is I'd encourage everyone to just take a look at some of the -- and there are a number of them, but some of the federal government ITQs and RFIs that are out there. And you'll see some pretty hard notions of what sovereignty means in some of those technology ITQs and RFIs.

So you really do need to be sovereign Canadian all the way through in order to qualify for some of the requirements that the federal government has. And in the case of Bell AI Fabric, what we can guarantee to our customers is their data will stay in Canada. And if the data needs to move, whether or not it's from St. John's to Vancouver points in between, it always stays in Canada. We have a definitive advantage in that regard.

I hear you. And the reason I'm asking this question is I have looked at the RFIs that the government has put out, and they have their definition. But how can that permeate into the enterprise market? Because -- I mean, I agree that getting a contract from the government is going to be probably -- their definition of what constitutes sovereign AI is probably the highest level of conservatism, let's say.

But what about the general enterprise, the Canadian enterprise market where so far, it seems like it's still -- it's true. It's not clear what constitutes sovereign AI. So do we need like some form of formal definition by a government agency to kickstart this new era of sovereign AI in Canada? Or do you think it might -- it will happen without some formal regulation?

I think it will happen without formal regulation. Just the market will speak there. And if the enterprise market in this space will be like it is in all the other enterprise vectors we operate in. I think our customers are going to rely on the providers that they trust, that they have deep relationships with. And I think there's going to be a preference for Canadian.

And that's with or without kind of the geopolitical concerns that permeate today. I think the geopolitical concerns just actually further help market demand being tilted towards Canadian providers. So if you take a step back, in the case of -- in our case, we have the deepest enterprise relationships.

We have the most long-standing enterprise relationships. We are speaking to our enterprise customers on AI-powered solutions, growth vectors at the same time as we're talking to them about the core business relationships that we've had for a long time. So as they seek to lean into AI workloads, we're in good shape in terms of having the infrastructure ready now.

And a key advantage in AI is time to power and time to compute, and we can deliver that. we can deliver data centers that are connected to the very best networks, all located in Canada from a company they trust and has provided reliable service to them for, in some cases, for over 100 years. So on the enterprise side, I think at this point in time, we're just going to rely on our unique market advantages.

Okay. And maybe just my follow-up question on wireless. You mentioned something interesting in your prepared remarks related to the amount of postpaid subscribers you loaded on the Bell brand. So I'm happy to see how you guys are pivoting your offering, making less emphasis on data buckets and more on quality and content and value-add services in wireless.

Can you maybe just dig a little bit deeper into what happened in Q3 as you made that pivot? Because when you look at the numbers from a big picture point of view, we see a lot more prepaid and postpaid loading this quarter versus last year. And so I'm trying just to make sure to understand what you meant by in your prepared remarks.

Yes. Okay. No, thank you for the question, Meyer. So our focus -- the first principle is that our focus remains on the financials. And what we're trying to do is balance subscriber loadings and the economics of those loadings. And I think you can see it in the financial results, whether or not it's service revenue and ARPU and obviously, the massive churn improvement.

Overall, you can see it also in our product intensity gains. And there's a whole long list of factors that have improved significantly. But on the postpaid wireless numbers, the consolidated number you see there, if you unpack those numbers, the Bell brand postpaid net adds are -- I don't want to give the number, but they're very, very large.

And so what that means is it's the flanker brand net adds that have declined so that you end up with the consolidated number in front of you of 12,000. But the Bell brand postpaid is a very big number. And so it's on strategy. The strategy is focus on the financials, focus on the Bell brand, focus on multiproduct offerings. And then underneath that, there's the new wireless tier plans, which I think are going to drive good subscriber numbers in the quarters ahead and certainly strong churn and financial numbers.

Our next question is from Stephanie Price from CIBC World Markets.

Hoping you can give us a bit of further color on the U.S. Internet environment now that you've had a full quarter of Ziply. Are there any changes to your thoughts on the pace of the U.S. fiber rollout here?

No, it's -- everything is on track, as Harold outlined in detail on October 14. So we're very pleased with Ziply's performance. And we're looking forward to continued growth. I mean the key thing is that it continues to perform ahead of our investment case. And the key thing is as we ramp the build in 2026, that's just going to lead to better subscriber revenue and EBITDA growth.

Okay. And then a follow-up for Curtis. Just on free cash flow growth. It was very solid in the quarter and year-to-date. The full year guide is obviously maintained. Hoping you can talk about the puts and takes here as to get to the bottom and the top of the full year range for free cash flow.

Yes. Stephanie, thanks for the question. So Q3 specifically was strong. There are some timing impacts, I'd just say off the top, still confident in the 6% to 11% full year. CapEx, we still expect it to be in the 15% CI for the full year. So it was a little bit lighter in Q3. Those are timing items. So we do expect Q4 to be heavier CapEx spend, which is probably what you're picking up on. So really nothing but reiteration of our full year expectations and timing in terms of CapEx and a few working cap items.

Our next question is from Sebastiano Petti from JPMorgan.

I guess just maybe following up a little bit on Jerome's question regarding the cost savings. I guess, can you update us where we're at in the $1.5 billion? Yes, I think at the Analyst Day, you talked about being halfway there. Help us maybe with the shaping of that? And maybe just remind us, Curtis, is that $1.5 billion a run rate exiting 2028?

So just some color on the shaping there would be helpful. And relatedly, as we think about the CAGRs on EBITDA, particularly understanding maybe there might be some margin compression as Ziply and PSP kind of ramp up over time.

So maybe help us think about the shaping of the consolidated EBITDA growth, I guess, over the forecast period. I mean, does it make sense that 2026 growth is maybe above trend as we kind of think about the guided range?

Thanks, Sebastiano. A few things to unpack there. In terms of margins to tie up to Jerome's earlier question and how that flows through. So I think cost savings, you're right, we're halfway through. That will continue to accelerate. So that lumpy with initiatives, but continues to increase year-over-year over year-over-year as we continue to leverage digital transformation and efficiency initiatives.

So I think you see relatively flat EBITDA margins over time. And our focus on reducing costs and driving efficiencies allows us to absorb some of the strong subscriber growth in the U.S., which includes COA, and it allows us to fund our other growth businesses like AI-powered solutions. So -- and again, those investments in the newer business, not only CapEx, it's OpEx also.

So flat margins on a percent basis, increasing margins on a dollar basis as we continue to transform the financial profile to more be heavily weighted towards future-focused products and services, while maintaining the same similar in-line EBITDA percent margin.

And then in terms of the U.S., again, 44% margin we've talked about between 40% and 45% in the U.S. So again, I think you'll see offset of efficiencies and scaling benefits in the U.S. with incremental costs and expense to drive subscriber growth as well as leveraging the PST network, which comes with a couple of incremental costs.

But ultimately, looking to drive EBITDA margin dollars while we focus on cost containment and efficiencies, but overall driving EBITDA dollars out of the U.S.

Our next question is from Tim Casey from BMO Capital Markets.

When you think about the growth in AI-powered solutions, doubling the $750 million by '28, will it be a balanced contribution between Ateko, Cyber and AI fabric? Or is one of those more likely to be an outsized contributor? And as a follow-on, at AI Fabric, do you not have to onboard the additional data centers, and I think it takes 9 months to build one.

So is there a cadence to that, that would be more back half or loaded more towards the back half of that time frame as you onboard these data centers? Or am I thinking about that incorrectly?

Thanks, Tim. So think on the unpacking the $1.5 billion as between the 3 components. I just -- if you go back to John Watson's Investor Day deck, you'll see we're expecting around $400 million from cyber, around $700 million from Ateko and around $400 million from AI fabric, and that would be your breakdown of the $1.5 billion.

And then in his slide deck, he has the annual growth rates that he's expecting for each of those three components of AI-powered solutions. And in terms of AI fabric and the time to build data centers and the like, I think I'll keep it a little bit more general.

You should expect -- I think we're expecting kind of a couple, 2, 3, let's say, launches in 2026. So it's not like we're going to be signing contracts in the first half of '26 and then you'll only get to see revenue in 2027. That will happen, but you will see some activity based on the pipeline we have in 2026 and our ability to open a few of those data centers next year.

Our next question is from Aravinda Galappatthige from Canaccord.

I just wanted to go back to the free cash flow question, Curtis. Obviously, you benefited a little bit from working capital movements. I think that's what you're referring to in terms of timing. So should we expect the sort of a more unusual or higher-than-usual working capital outflow in Q4?

And then I guess the larger question is, when I look at the '25 to '28 free cash flow projections you provided, it suggests that you still anticipate fairly meaningful working capital outflows right through that period. And I just wanted to understand a little bit more why that it needs to be consistently fairly high. Maybe I'll just start there.

Yes. Thanks for the question, Aravinda. So obviously, puts and takes within the free cash flow buckets, I can't control all of the timing on individual payments. I'd say we are continuing our focus on working capital management. So we've seen benefits in inventory. We're managing receivables and especially.

So I do think we've seen goodness there. But again, that fluctuates quarter-to-quarter. I'd just say overall free cash flow confident in our full year 2025 guidance. So no real change there. CapEx is a bigger driver of kind of and north of what Q4 was last year. So that's this year.

And then ultimately, as we talk about free cash flow, '25 to '28, there are a few things happening. One, CapEx dollars flat, but lease repayments will come down. So kind of as I think of the capital investments over time combined between what is accounted for as CapEx versus leases, that total bucket comes down over time.

I do think -- so the decrease in that combined bucket leads to payable decreases over time as well. So you don't capture all the free cash flow benefit in the same period where your CapEx comes down. But over that period, we will capture the benefit. And beyond that, ultimately, you're just normalizing your way through, right? By the time you're at 2028, there's no buildup or onetime. You're just a run rate free cash flow generating business.

Understood. And just my quick follow-up on the comments you made on the enterprise side, Mirko. As you kind of push ahead, talk to the CIOs with pushing ahead with the Ateko and Cyber, what kind of competition are you coming up against? Is it sort of the more fragmented independent players? Or is it sort of the larger established players? Do you -- to what extent do you have sort of unseat some of these existing incumbents in that area to sort of win over the sort of the IT services and cybersecurity mandates there?

Yes. Thank you for the question, Aravinda. So I'd say when it comes to the collection of the overall offering that we have in AI-powered solutions business, the full stack AI the AI platform, the integration of AI automation platforms through Ateko and Bell Cyber.

When you put all that together, frankly, we're one of one. And I'm not exaggerating. We are -- when you look at all 3 together, we are one of one. If you want to kind of look at each one discretely, there are others who provide cybersecurity solutions, but nobody who can kind of provide the integration of the Bell network security platform with the automated cloud-based AI-powered SOC that the former strategy and now the combined business is called Bell Cyber offers.

And on Ateko, there are a number of systems integrators out there. We all know their names. But what stands Ateko apart are many things, but two in particular that I would call out. One is we are very focused. And I've talked about this before. We have a clear lane of verticals where we're targeting. And we are hyper focused on AI and the hyperscale platforms, whether or not it's ServiceNow, Salesforce or the three hyperscalers.

So we provide the benefit of a really focused expertise. And then the other thing that stands Ateko apart from anyone else is we are both an operator and an integrator. So Ateko does for our third-party customers, what it does for Bell. So we can offer the real experience of having done it for an operator. So we know the use cases that work, where you're wasting your time as a customer.

And I think that's a value add that the classic SIs don't provide. So I'll leave it there. But you see it in the growth numbers. I mean we only started this in 2023 with Ateko. And since then, even this year, like we rebranded Ateko, we launched Bell Cyber, and we've launched on May 29 of this year, AI fabric, and it's pretty strong growth in its own right.

Our next question is from Batya Levi from UBS.