TELUS International (Cda) Inc.

Q1 2025 revenue was $670 million, up 2% year over year, or 3% constant currency. Adjusted EBITDA margin was 13.4%, down year over year, and free cash flow was $41 million. Revenue with TELUS grew 12% year over year; tech and games revenue increased 1%, BFSI revenue grew 11%, and revenue in communication and media and healthcare grew strongly, while Asia Pacific revenue was stable and Central America and Europe grew. Full-year 2025 outlook was reiterated for approximately 2% organic revenue growth, approximately $400 million of adjusted EBITDA, and approximately 32¢ adjusted diluted EPS.

Jason Magnaville framed the quarter as stable and strategically important, saying the company is using 2025 as an investment year to build capabilities in AI, data solutions, trust and safety, and digital solutions. He repeatedly stressed diversification across clients, geographies, and service lines, while pointing to TELUS as a unique anchor relationship that provides stability and a test bed for new AI-driven operating models. His tone was constructive and confident, but measured, with repeated emphasis on disciplined execution and earning the right to invest.

Gopi Chande said Q1 revenue of $670 million was up 2% year over year and that adjusted EBITDA margin was 13.4%, with pressure from higher salaries and benefits, goods and services costs, a tougher comparison to 2024 other income, and higher share-based compensation. Free cash flow was $41 million, down due to working-capital timing, lower profitability, and higher capital expenditures. He said net debt to adjusted EBITDA leverage was 3.4x at March 31 versus 3.2x at December 31, still within covenant, and noted the earlier amendment delaying the leverage step-down to 3.25x until Q1 2026. He also said the company expects about $67 million of OpEx and CapEx investments and is targeting about $50 million of efficiencies.

Analysts pressed on how the TELUS relationship works economically, and management said engagements typically start with an audit and consultative work, then move into development, implementation, and ongoing management, with some outcome-based pricing under discussion. On margins versus diversification, management said 2025 is an investment year, but they are targeting indirect costs and aiming for stable margins while expanding differentiated offerings. Questions on headcount and AI drew a clear answer: management sees opportunity for a smaller total workforce over time because AI can lift productivity, though they still need to hire key engineering and LLM talent. On tariffs and macro risk, management said the biggest issue is second-order effects like slower growth and more cost-reduction focus, which they believe plays to their efficiency and AI positioning.