[Condensed Interim Consolidated Statements of Income (Loss) and Other Comprehensive Income (Loss)](index=2&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Income%20(Loss)%20and%20Other%20Comprehensive%20Income%20(Loss)) [Income Statement Overview](index=2&type=section&id=Income%20Statement%20Overview) TELUS International reported a significant net loss for Q2 and H1 2025, driven by substantial amortization and goodwill impairment, as operating expenses exceeded modest revenue growth Income Statement Overview (millions USD) | Metric (millions USD) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $699 | $652 | $1,369 | $1,309 | | Operating Expenses | $965 | $641 | $1,632 | $1,260 | | Operating (Loss) Income| $(266) | $11 | $(263) | $49 | | Net (Loss) Income | $(272) | $(3) | $(297) | $25 | | Basic EPS | $(0.98) | $(0.01) | $(1.07) | $0.09 | | Diluted EPS | $(0.98) | $(0.08) | $(1.07) | $(0.05) | - A significant increase in **Amortization of intangible assets and impairment of goodwill** from **$44 million to $271 million** for the three months ended June 30, 2025, and from **$89 million to $317 million** for the six months ended June 30, 2025, was a primary driver of the operating and net losses[3](index=3&type=chunk) [Condensed Interim Consolidated Statements of Financial Position](index=3&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Financial%20Position) [Financial Position Overview](index=3&type=section&id=Financial%20Position%20Overview) As of June 30, 2025, the company's total assets slightly decreased compared to December 31, 2024, primarily due to a reduction in goodwill and intangible assets, while total liabilities increased, leading to a decrease in owners' equity Financial Position Overview (millions USD) | Metric (millions USD) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total Assets | $4,439 | $4,521 | | Current Assets | $761 | $707 | | Non-current Assets | $3,678 | $3,814 | | Total Liabilities | $2,745 | $2,576 | | Current Liabilities | $907 | $745 | | Non-current Liabilities| $1,838 | $1,831 | | Owners' Equity | $1,694 | $1,945 | - **Goodwill decreased from $1,926 million to $1,789 million**, and **intangible assets, net, decreased from $1,379 million to $1,344 million**, contributing to the overall decrease in total assets[5](index=5&type=chunk) - **Current liabilities increased significantly from $745 million to $907 million**, driven by increases in accounts payable and accrued liabilities, due to affiliated companies, and current portion of provisions[5](index=5&type=chunk) [Condensed Interim Consolidated Statements of Changes in Owners' Equity](index=4&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Changes%20in%20Owners'%20Equity) [Owners' Equity Changes Overview](index=4&type=section&id=Owners'%20Equity%20Changes%20Overview) Owners' equity decreased significantly from $1,945 million at January 1, 2025, to $1,694 million at June 30, 2025, primarily due to a net loss of $297 million, partially offset by other comprehensive income and share-based compensation Owners' Equity Changes Overview (millions USD) | Metric (millions USD) | January 1, 2025 | June 30, 2025 | | :-------------------- | :-------------- | :------------ | | Total Owners' Equity | $1,945 | $1,694 | | Net Loss | — | $(297) | | Other Comprehensive Income | — | $34 | | Share-based Compensation | — | $12 | - **Retained earnings shifted from a positive balance of $286 million at January 1, 2025, to a deficit of $(11) million by June 30, 2025**, reflecting the net loss incurred during the period[7](index=7&type=chunk) [Condensed Interim Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Cash%20Flows) [Cash Flow Overview](index=5&type=section&id=Cash%20Flow%20Overview) Cash provided by operating activities decreased for the six months ended June 30, 2025, compared to the prior year, while cash used in investing activities remained relatively stable, and cash used in financing activities also decreased, resulting in a net decrease in cash and cash equivalents for the period Cash Flow Overview (millions USD) | Metric (millions USD) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Operating Activities | $63 | $124 | $132 | $250 | | Investing Activities | $(31) | $(28) | $(58) | $(53) | | Financing Activities | $(26) | $(97) | $(107) | $(171) | | Net Change in Cash | $14 | $(2) | $(23) | $25 | | Cash, End of Period | $151 | $152 | $151 | $152 | - **Cash provided by operating activities for the six months ended June 30, 2025, was $132 million, a decrease from $250 million** in the prior year, despite adjustments for non-cash items like depreciation, amortization, and goodwill impairment[10](index=10&type=chunk) - **Long-term debt issued significantly increased to $387 million** for the six months ended June 30, 2025, compared to $90 million in the prior year, while **repayment of long-term debt also increased to $452 million** from $212 million[10](index=10&type=chunk) [Notes to Condensed Interim Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20Condensed%20Interim%20Consolidated%20Financial%20Statements) [General application](index=6&type=section&id=General%20application) This section details TELUS International's rebranding, financial statement basis, IFRS accounting updates, and capital structure policies - **TELUS International (Cda) Inc. was formally rebranded to TELUS Digital Experience in Q3 2024**, focusing on digital customer experience solutions and future-focused digital transformations[12](index=12&type=chunk) - The condensed interim consolidated financial statements are **prepared in United States dollars**, **comply with IAS 34, Interim Financial Reporting**, and **follow IFRS Accounting Standards**[17](index=17&type=chunk) [1. Condensed interim consolidated financial statements](index=6&type=section&id=1.%20Condensed%20interim%20consolidated%20financial%20statements) This section discusses financial seasonality and the limited expected impact of new IFRS 18, IFRS 9, and IFRS 7 accounting standards - The company's **financial performance is subject to seasonality**, with **revenues typically higher in the third and fourth quarters**, though this can vary based on client operating environments and foreign currency rates[16](index=16&type=chunk) - **IFRS 18, effective January 1, 2027**, will replace IAS 1, **requiring new subtotals for operating profit and profit before financing and income taxes**, and **enhanced disclosure of management-defined performance measures**, with the company **expecting limited material impact** on total financial disclosure[18](index=18&type=chunk)[19](index=19&type=chunk)[24](index=24&type=chunk) - **Amendments to IFRS 9 and IFRS 7, effective January 1, 2026**, address classification of financial assets with ESG features and de-recognition dates for electronic payments, with the company **not expecting material impacts**[20](index=20&type=chunk) [2. Capital structure financial policies](index=7&type=section&id=2.%20Capital%20structure%20financial%20policies) The company manages capital to optimize cost and availability at acceptable risk levels, defining capital as owners' equity, long-term debt, and cash - The company's objective in managing capital is to **maintain a flexible capital structure that optimizes cost and availability of capital at acceptable risk levels**[21](index=21&type=chunk) - **Capital is defined to include owners' equity, long-term debt, and cash and cash equivalents**, and **management monitors financial covenants in its credit facility**[22](index=22&type=chunk) [3. Revenue](index=8&type=section&id=3.%20Revenue) Revenue for the three and six months ended June 30, 2025, showed growth, primarily driven by the Tech and Games, Communications and Media, and Healthcare industry verticals, with Europe and North America contributing most to the revenue increase Revenue by Industry Vertical (millions USD) | Industry Vertical (millions USD) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Tech and Games | $304 | $275 | $586 | $553 | | Communications and Media | $175 | $158 | $348 | $318 | | eCommerce and FinTech | $56 | $65 | $114 | $133 | | Healthcare | $51 | $47 | $101 | $96 | | Banking, Financial Services and Insurance | $42 | $39 | $82 | $75 | | All others | $71 | $68 | $138 | $134 | | **Total Revenue** | **$699** | **$652** | **$1,369** | **$1,309** | Revenue by Geographic Region (millions USD) | Geographic Region (millions USD) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Europe | $212 | $187 | $415 | $383 | | North America | $200 | $180 | $384 | $368 | | Asia-Pacific | $160 | $164 | $317 | $321 | | Central America and others | $127 | $121 | $253 | $237 | | **Total Revenue** | **$699** | **$652** | **$1,369** | **$1,309** | - Effective for Q1 2025, **Asia-Pacific now includes Africa**, and **Central America and others includes South America**, with comparative information restated[26](index=26&type=chunk) [4. Share-based compensation](index=8&type=section&id=4.%20Share-based%20compensation) The company grants equity-settled RSUs, PSUs, and share options, with activity in these plans impacting share capital and compensation expense - RSUs and PSUs are granted, with **PSUs having variable payouts (0%-300%) based on operating performance targets or relative total shareholder return**[27](index=27&type=chunk) RSU/PSU Activity (units) | RSU/PSU Activity (units) | Outstanding, beginning of period (Non-vested) | Granted | Vested | Exercised | Forfeited | Outstanding, June 30, 2025 (Non-vested) | | :----------------------- | :-------------------------------------------- | :------ | :----- | :-------- | :-------- | :-------------------------------------- | | Three months ended June 30, 2025 | 25,277,511 | 103,094 | (105,969)| — | (3,521,056)| 21,753,580 | | Six months ended June 30, 2025 | 20,180,936 | 8,882,253| (3,167,785)| — | (4,141,824)| 21,753,580 | - As of June 30, 2025, outstanding restricted share units comprised **12,308,395 RSUs**, **8,670,676 PSUs with non-market conditions**, and **774,509 PSUs with market conditions**[29](index=29&type=chunk) Share Option Activity (units) | Share Option Activity (units) | Outstanding, beginning of period (Non-vested) | Vested | Forfeited | Outstanding, June 30, 2025 (Non-vested) | | :---------------------------- | :-------------------------------------------- | :----- | :-------- | :-------------------------------------- | | Three months ended June 30, 2025 | 2,899,794 | — | (83,279) | 2,816,515 | | Six months ended June 30, 2025 | 2,988,882 | (89,088)| (83,279) | 2,816,515 | [5. Interest expense](index=9&type=section&id=5.%20Interest%20expense) Interest expense decreased for both the three and six months ended June 30, 2025, primarily due to lower interest on long-term debt, excluding lease liabilities Interest Expense (millions USD) | Interest Expense (millions USD) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Interest on long-term debt, excluding lease liabilities | $21 | $26 | $41 | $50 | | Interest on lease liabilities | $9 | $8 | $16 | $15 | | Amortization of financing fees and other | $1 | — | $2 | $1 | | Interest accretion on provisions| $3 | $2 | $5 | $5 | | **Total Interest Expense** | **$34** | **$36** | **$64** | **$71** | [6. Income taxes](index=10&type=section&id=6.%20Income%20taxes) The company recorded an income tax recovery for both the three and six months ended June 30, 2025, primarily due to deferred income tax recovery and adjustments for prior periods, despite current income tax expense Income Tax (millions USD) | Income Tax (millions USD) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Current income tax expense (recovery) | $(1) | $10 | $10 | $22 | | Deferred income tax recovery | $(34) | $(6) | $(45) | $(9) | | **Total Income Tax (recovery) expense** | **$(35)** | **$4** | **$(35)** | **$13** | - The **effective income tax rate for the six months ended June 30, 2025, was 10.5%**, **significantly lower than the 34.2% in the prior year**, influenced by goodwill impairment and losses not recognized[32](index=32&type=chunk) [7. Earnings (loss) per share](index=10&type=section&id=7.%20Earnings%20(loss)%20per%20share) Basic and diluted EPS reflected a significant loss for Q2 and H1 2025 due to net loss, with anti-dilutive share-based compensation and written put options excluded EPS Metric (millions except per share) | EPS Metric (millions except per share) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net (loss) income for the period | $(272) | $(3) | $(297) | $25 | | Weighted average number of equity shares outstanding | 278 | 275 | 277 | 274 | | Basic (loss) earnings per share | $(0.98) | $(0.01) | $(1.07) | $0.09 | Diluted EPS Metric (millions except per share) | Diluted EPS Metric (millions except per share) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Fully diluted net (loss) income | $(272) | $(24) | $(297) | $(15) | | Weighted average number of diluted equity shares outstanding | 278 | 294 | 277 | 291 | | Diluted (loss) earnings per share | $(0.98) | $(0.08) | $(1.07) | $(0.05) | - For the periods ended June 30, 2025, **dilutive effects of share-based compensation and written put options were excluded from diluted loss per share calculation because their conversion would decrease the loss per share (anti-dilutive)**[37](index=37&type=chunk) [8. Accounts receivable](index=11&type=section&id=8.%20Accounts%20receivable) Accounts receivable increased as of June 30, 2025, compared to December 31, 2024, with a notable increase in billed customer accounts receivable over 61 days past due, and the allowance for doubtful accounts also saw a slight increase Accounts Receivable (millions USD) | Accounts Receivable (millions USD) | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------ | :---------------- | | Accounts receivable – billed | $228 | $194 | | Accounts receivable – unbilled | $229 | $240 | | Other receivables | $43 | $28 | | Allowance for doubtful accounts | $(9) | $(8) | | **Total** | **$491** | **$454** | Customer Accounts Receivable – Billed (millions USD) | Customer Accounts Receivable – Billed (millions USD) | June 30, 2025 | December 31, 2024 | | :--------------------------------------------------- | :------------ | :---------------- | | Less than 30 days past billing date | $131 | $123 | | 30-60 days past billing date | $56 | $52 | | 61-90 days past billing date | $23 | $8 | | More than 90 days past billing date | $9 | $3 | - The **allowance for doubtful accounts increased from $8 million at the beginning of 2025 to $9 million at June 30, 2025**, with **$1 million in additions** during the six-month period[41](index=41&type=chunk) [9. Financial instruments](index=12&type=section&id=9.%20Financial%20instruments) The company uses derivative financial instruments to manage currency and interest rate risks, measured at fair value, with some designated for hedge accounting - The **carrying values of most current financial instruments and long-term debt approximate their fair values**[42](index=42&type=chunk) - **Derivative financial instruments are used to manage exposure to currency risks (EUR:USD, PHP:USD) and interest rate risk**, with fair values estimated based on market prices or discounted future cash flows[43](index=43&type=chunk)[45](index=45&type=chunk) - **Some foreign currency hedges are designated as held for trading (HFT) without hedge accounting**, while **others are designated as held for hedging (HFH) with hedge accounting applied**, particularly for currency risks from Euro business acquisition and interest rate risk[46](index=46&type=chunk)[47](index=47&type=chunk) [10. Property, plant and equipment](index=13&type=section&id=10.%20Property%2C%20plant%20and%20equipment) The net book value of property, plant and equipment increased from $456 million at December 31, 2024, to $507 million at June 30, 2025, driven by additions to both owned assets and right-of-use lease assets Property, Plant and Equipment (millions USD) | Property, Plant and Equipment (millions USD) | December 31, 2024 | June 30, 2025 | | :------------------------------------------- | :---------------- | :------------ | | Owned assets, net book value | $238 | $257 | | Right-of-use lease assets, net book value | $218 | $250 | | **Total Net Book Value** | **$456** | **$507** | - **Additions to owned assets totaled $46 million** and to **right-of-use lease assets totaled $61 million** during the six months ended June 30, 2025[48](index=48&type=chunk) [11. Intangible assets and goodwill](index=13&type=section&id=11.%20Intangible%20assets%20and%20goodwill) Intangible assets and goodwill decreased from $3,305 million to $3,133 million, primarily due to a **$224 million goodwill impairment loss** reflecting macroeconomic pressures Intangible Assets and Goodwill (millions USD) | Intangible Assets and Goodwill (millions USD) | December 31, 2024 | June 30, 2025 | | :-------------------------------------------- | :---------------- | :------------ | | Total intangible assets, net book value | $1,379 | $1,344 | | Goodwill, net book value | $1,926 | $1,789 | | **Total intangible assets and goodwill** | **$3,305** | **$3,133** | - A **goodwill impairment loss of $224 million** was recorded for the six months ended June 30, 2025, due to prolonged macroeconomic pressures affecting customer demand and key future growth assumptions[51](index=51&type=chunk) - The recoverable amount for goodwill was determined using a **fair value less costs of disposal method (Level 3 fair value measure)**, with a **discount rate of 10.1%** and a **perpetual growth rate of 2.5%**[52](index=52&type=chunk) [12. Provisions](index=14&type=section&id=12.%20Provisions) Total provisions increased from $146 million at January 1, 2025, to $163 million at June 30, 2025, primarily due to additions related to employee restructuring and other activities, partially offset by usage and reversals Provisions (millions USD) | Provisions (millions USD) | January 1, 2025 | June 30, 2025 | | :------------------------ | :-------------- | :------------ | | Employee related | $6 | $9 | | Written put options | $134 | $134 | | Other | $6 | $20 | | **Total** | **$146** | **$163** | - During Q2 2025, the company implemented a **workforce restructuring initiative** at one of its delivery locations, leading to **additions in employee-related restructuring provisions**[54](index=54&type=chunk) - A **provision for written put options related to the WillowTree acquisition in 2023 remained at $134 million**[55](index=55&type=chunk) [13. Long-term debt](index=15&type=section&id=13.%20Long-term%20debt) Total long-term debt increased to $1,560 million at June 30, 2025, from $1,525 million at December 31, 2024, primarily due to an increase in lease liabilities, and the company remains in compliance with all financial covenants of its credit facility Long-term Debt (millions USD) | Long-term Debt (millions USD) | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Credit facility | $1,280 | $1,284 | | Lease liabilities | $289 | $249 | | Deferred debt transaction costs | $(9) | $(8) | | **Total Long-term Debt** | **$1,560** | **$1,525** | - The credit facility, maturing January 3, 2028, has an **effective interest rate of 6.7%** as of June 30, 2025 (vs 6.5% at Dec 31, 2024)[57](index=57&type=chunk) - The company was **in compliance with all financial covenants**, including the **Net Debt to Adjusted EBITDA ratio (not to exceed 3.75:1.00)** for 2025 and **Adjusted EBITDA to Debt Service ratio (not less than 1.50:1.00)**[59](index=59&type=chunk) Long-term Debt Maturities (millions USD) | Long-term Debt Maturities (millions USD) | Long-term debt, excluding leases | Leases (U.S. dollars) | Leases (European euros) | Leases (Other currencies) | Total | | :--------------------------------------- | :------------------------------- | :-------------------- | :---------------------- | :------------------------ | :---- | | 2025 (remainder of year) | $30 | $10 | $8 | $12 | $60 | | 2026 | $60 | $18 | $11 | $26 | $115 | | 2027 | $60 | $17 | $8 | $21 | $106 | | 2028 | $1,130 | $16 | $5 | $19 | $1,170| | 2029 | — | $20 | $5 | $14 | $39 | | Thereafter | — | $33 | $27 | $19 | $79 | | **Total Principal Repayments** | **$1,280** | **$114** | **$64** | **$111** | **$1,569**| [14. Share capital](index=16&type=section&id=14.%20Share%20capital) The company's authorized share capital includes unlimited Preferred Shares, Multiple Voting Shares, and Subordinate Voting Shares, with 164 million Multiple Voting Shares and 114 million Subordinate Voting Shares issued as of June 30, 2025 Share Capital (millions) | Share Capital (millions) | June 30, 2025 (Issued) | December 31, 2024 (Issued) | | :----------------------- | :--------------------- | :------------------------- | | Multiple Voting Shares | 164 | 164 | | Subordinate Voting Shares| 114 | 112 | - **66 million authorized but unissued subordinate voting shares are reserved for share-based compensation plans**, and **4 million for the employee share purchase plan**[62](index=62&type=chunk) [15. Contingent liabilities](index=16&type=section&id=15.%20Contingent%20liabilities) The company has indemnification obligations with no significant historical payments and is party to various legal proceedings with uncertain outcomes - Indemnification obligations are provided in conjunction with certain transactions, with no maximum limit in some cases, but historically, **no significant payments have been made**[63](index=63&type=chunk)[64](index=64&type=chunk) - The company is involved in various legal proceedings and claims, the **ultimate outcome of which is inherently uncertain and could potentially impact operations and financial condition**[65](index=65&type=chunk) [16. Related party transactions](index=17&type=section&id=16.%20Related%20party%20transactions) TELUS, the controlling parent, is a significant related party with whom the company engages in recurring service transactions and recognizes share-based compensation for key management - **TELUS and its subsidiaries receive customer care, integrated business process outsourcing, information technology outsourcing, and digital product development services** from the company[67](index=67&type=chunk) Transactions with TELUS and subsidiaries (millions USD) | Transactions with TELUS and subsidiaries (millions USD) | Three months ended June 30, 2025 | Six months ended June 30, 2025 | | :------------------------------------------------------ | :------------------------------- | :----------------------------- | | Revenues from services provided to | $179 | $357 | | Goods and services purchased from | $(6) | $(13) | | Due from affiliated companies | $28 | $28 | | Due to affiliated companies | $(314) | $(314) | - **Share-based compensation expense of $3 million and $5 million was recognized for key management personnel** during the three and six months ended June 30, 2025, respectively[70](index=70&type=chunk)[71](index=71&type=chunk) [17. Additional financial information](index=19&type=section&id=17.%20Additional%20financial%20information) This section provides supplementary financial details, including major client revenue, accounts payable breakdown, and reconciliation of non-cash working capital and financing liabilities - **TELUS, the controlling shareholder, accounted for 26.1% of consolidated revenue** for the six months ended June 30, 2025 (vs 24.4% in 2024), and **Google accounted for 11.6%** (vs 14.3% in 2024)[72](index=72&type=chunk) Accounts Payable and Accrued Liabilities (millions USD) | Accounts Payable and Accrued Liabilities (millions USD) | June 30, 2025 | December 31, 2024 | | :------------------------------------------------------ | :------------ | :---------------- | | Trade accounts payable | $21 | $36 | | Accrued liabilities | $106 | $102 | | Payroll and other employee-related liabilities | $175 | $159 | | Advance billings | $20 | $12 | | Other | $34 | $12 | | **Total** | **$356** | **$321** | Changes in Liabilities from Financing Activities (millions USD) | Changes in Liabilities from Financing Activities (millions USD) | Six months ended June 30, 2025 (Issued or received) | Six months ended June 30, 2025 (Repayments or payments) | | :-------------------------------------------------------------- | :-------------------------------------------------- | :------------------------------------------------------ | | Credit facility | $387 | $(406) | | Lease liabilities | — | $(46) |

Group 1: Earnings Performance - Telus Digital reported quarterly earnings of $0.06 per share, matching the Zacks Consensus Estimate, but down from $0.22 per share a year ago [1] - The company had a loss of $0.04 per share last quarter, which was a surprise of -300% compared to the expected loss of $0.01 per share [1] - Over the last four quarters, Telus Digital has only surpassed consensus EPS estimates once [1] Group 2: Revenue Performance - The company posted revenues of $670 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 2.86% and up from $657 million year-over-year [2] - Telus Digital has topped consensus revenue estimates three times over the last four quarters [2] Group 3: Stock Performance and Outlook - Telus Digital shares have declined approximately 32.7% since the beginning of the year, compared to a decline of -3.7% for the S&P 500 [3] - The future performance of the stock will depend on management's commentary during the earnings call and the earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.06 on revenues of $656.42 million, and for the current fiscal year, it is $0.33 on revenues of $2.7 billion [7] Group 4: Industry Context - The Technology Services industry, to which Telus Digital belongs, is currently ranked in the top 26% of over 250 Zacks industries, indicating a favorable outlook [8] - The top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1 [8]

Group 1: Earnings Performance - Telus International reported quarterly earnings of $0.06 per share, matching the Zacks Consensus Estimate, but down from $0.22 per share a year ago [1] - The company had a loss of $0.04 per share in the previous quarter, which was a surprise of -300% compared to the expected loss of $0.01 per share [1] - Over the last four quarters, Telus International has only surpassed consensus EPS estimates once [1] Group 2: Revenue Performance - The company posted revenues of $670 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 2.86% and up from $657 million year-over-year [2] - Telus International has topped consensus revenue estimates three times over the last four quarters [2] Group 3: Stock Performance and Outlook - Telus International shares have declined approximately 32.7% since the beginning of the year, compared to a decline of -3.7% for the S&P 500 [3] - The company's earnings outlook will be crucial for future stock performance, with current consensus EPS estimates at $0.06 for the coming quarter and $0.33 for the current fiscal year on revenues of $656.42 million and $2.7 billion, respectively [7] Group 4: Industry Context - The Technology Services industry, to which Telus International belongs, is currently ranked in the top 26% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Telus International's stock performance [5][6]

Revenue and Earnings - Revenue for the three months ended March 31, 2025, was $670 million, a 1.98% increase from $657 million in the same period of 2024[26] - The largest revenue contributions came from the Tech and Games sector at $282 million, followed by Communications and Media at $173 million[26] - Basic loss per share for the three months ended March 31, 2025, was $(0.09), compared to earnings of $0.10 per share in the same period of 2024[34] - The company reported a net loss of $25 million for the three months ended March 31, 2025, compared to a net income of $28 million in the same period of 2024[34] - Revenues from services provided to TELUS and its subsidiaries amounted to $178 million for the three months ended March 31, 2025, compared to $160 million in the same period of 2024[62] - TELUS accounted for 26.6% of consolidated revenue in Q1 2025, up from 24.3% in Q1 2024; Google contributed 12.0%, down from 14.5%[64] Expenses and Financial Management - Interest expense for the three months ended March 31, 2025, totaled $30 million, down from $35 million in the same period of 2024, reflecting a decrease of 14.29%[31] - The company’s interest on long-term debt, excluding lease liabilities, was $20 million for the three months ended March 31, 2025, down from $24 million in the same period of 2024[31] - Share-based compensation expense for key management personnel was recognized at $2 million for the three-month period ended March 31, 2025[63] - The company initiated a restructuring program in April 2025, which is expected to impact personnel-related provisions[50] Assets and Liabilities - The total accounts receivable as of March 31, 2025, was $459 million, slightly up from $454 million as of December 31, 2024[37] - The allowance for doubtful accounts increased from $2 million at the beginning of the period to $8 million by March 31, 2025, reflecting a significant rise in provisions[39] - The total property, plant, and equipment increased from $1,053 million at the beginning of the year to $1,098 million by March 31, 2025, indicating growth in owned assets[45] - Intangible assets and goodwill rose from $3,971 million at the beginning of the year to $4,024 million by March 31, 2025, driven by foreign exchange adjustments and software additions[46] - The accumulated amortization of intangible assets was $720 million as of March 31, 2025, reflecting ongoing depreciation of intangible assets[46] - The company reported a net book value of property, plant, and equipment of $465 million as of March 31, 2025, compared to $456 million at the end of 2024[45] - Total accounts payable and accrued liabilities decreased slightly from $321 million as of December 31, 2024, to $317 million as of March 31, 2025[65] - The company experienced a net decrease in accounts receivable of $15 million in Q1 2025, compared to a decrease of $18 million in Q1 2024[66] Debt and Capital Structure - As of March 31, 2025, total long-term debt amounted to $1,490 million, a decrease from $1,525 million as of December 31, 2024[52] - The credit facility includes an $800 million revolving credit facility and a $1.2 billion term loan, with an effective interest rate of 6.7% as of March 31, 2025[53] - The company has a Net Debt to Adjusted EBITDA ratio requirement not to exceed 3.75:1.00 for fiscal 2025, with a minimum Adjusted EBITDA to Debt Service ratio of 1.50:1.00[54] - Anticipated long-term debt repayments for 2025 total $62 million, with $1,094 million due in 2028[56] - As of March 31, 2025, the company had $595 million available under the revolving credit facility[54] - The credit facility balance was $1,284 million at the beginning of Q1 2025, with repayments of $189 million during the period[67] - Long-term debt decreased from $1,750 million at the beginning of Q1 2024 to $1,490 million at the end of Q1 2025[67] Other Financial Information - The fair value of derivative financial instruments related to currency risks from Euro business acquisition was $10 million as of March 31, 2025, with a notional amount of $33 million[43] - The fair value of derivatives used to manage currency risks from Philippine peso purchases was $1 million with a notional amount of $85 million as of March 31, 2025[43] - The company established a provision for written put options related to the acquisition of WillowTree in 2023[51] - As of March 31, 2025, the company had no recorded liability for indemnification obligations[58] - The company reported a cash payment of $28 million for capital assets in Q1 2025, compared to $19 million in Q1 2024[66] - Capital expenditures for property, plant, and equipment were $22 million in Q1 2025, compared to $13 million in Q1 2024[66] - Lease liabilities increased from $249 million at the beginning of Q1 2025 to $254 million at the end of the period[67] - The company is assessing the impacts of new accounting standards effective January 1, 2027, but does not expect material effects on financial disclosures[20] - The recoverable amount of the TELUS Digital cash-generating unit was slightly above its carrying amount, determined using a discount rate of 9.8% and a perpetual growth rate of 3.0%[47] - The company noted that any adverse changes in future financial performance could lead to material impairment charges for the TELUS Digital cash-generating unit's goodwill[49]

NEW YORK, March 30, 2025 (GLOBE NEWSWIRE) -- WHY: Rosen Law Firm, a global investor rights law firm, reminds purchasers of securities of TELUS International (Cda) Inc. (NYSE: TIXT) between February 16, 2023 and August 1, 2024, both dates inclusive (the "Class Period"), of the important March 31, 2025 lead plaintiff deadline. SO WHAT: If you purchased TELUS International securities during the Class Period you may be entitled to compensation without payment of any out of pocket fees or costs through a conting ...