Rogers CEO 'deeply disappointed' software upgrade caused wireless outage

·3 min read

TORONTO — The chief executive of Rogers Communications Inc. told analysts Wednesday that he and his team are "deeply disappointed" by the widespread outage that affected many of its wireless customers this week.

"We worked very hard to earn the trust of our customers, and we're going to work very hard to earn it back," Rogers CEO Joe Natale said in a conference call about financial results.

The Rogers first-quarter earnings report and the virtual meeting of Rogers shareholders on Wednesday follow Monday's major outage for the national wireless company, which operates the Rogers, Fido and Chatr brands.

The nearly daylong wireless interruption affected business sales and services, and the ability for some customers to book or check in for medical appointments.

Many users expressed frustration with the outage, noting that they rely on the wireless service to work from home under ongoing COVID-19 restrictions.

The company said in an email Tuesday that it will issue a credit, equivalent to Monday's wireless service fee, to be applied automatically to May bills, with no action required by customers.

Natale said Wednesday that the outage began with a software upgrade by Ericsson, the company's main supplier of wireless network gear.

"Despite all the testing that we did with respect to the software upgrade, it simply caused the problems, and it took us a while to recover," Natale said.

"The problem started early Monday with intermittent failures the prevented customers from connecting. And (it was) the better part of about 16 hours before we could get things back to normal."

Monday's outage, which happened near the beginning of the Rogers 2021 second quarter, followed strong year-over-year growth for its wireless division in the first quarter ended March 31.

The wireless division, which accounts for nearly 60 per cent of overall revenue, had its strongest first-quarter in three years in terms of loading and post-paid net additions, Natale said.

Earlier, Rogers reported a three per cent increase in first-quarter profit compared with the same time last year, which included the first weeks of Canada's COVID-19 lockdowns.

"We further maintained strong customer retention this quarter, achieving postpaid churn of 0.88 per cent, an additional five basis point improvement year-on-year," Natale said.

(A basis point is equal to 0.01 per cent.)

Total net income for the company, including its home internet, radio and television and sports businesses, was $361 million or 70 cents per diluted share.

That was up from $352 million or 68 cents per diluted share in the first quarter of 2020, which included a few weeks of Canada's first COVID-related shutdowns.

Adjusted net income was $394 million or 77 cents per diluted share, which was 16.4 per cent above analyst estimates.

Total revenue was nearly $3.49 billion, also above estimates and up two per cent from $3.42 billion a year ago.

About $2 billion of total revenue was from the Rogers wireless business, down slightly from last year. The cable division, which includes home internet service, generated about $1 billion of revenue. Media, which includes the Toronto Blue Jays baseball franchise, generated $440 million in revenue.

On average, analysts had estimated 66 cents per share of adjusted net income and $3.35 billion of revenue, according to financial information provider Refinitiv.

This report by The Canadian Press was first published April 21, 2021.

— with files from Brett Bundale.

Companies in this story: (TSX:RCI.B, TSX:SJR.B)

David Paddon, The Canadian Press