The only fresh comment on outlook was that Chorus now sees full-year earnings coming in near the top of its range.

First-half revenue was up 1% to $506m. Average revenue per fibre user per month (arpu) rose 4.3% from $55.34 to $57.73.

“The shift was driven by pricing increases,” Chorus said.

The price rises have been passed on by Spark, One NZ, 2degrees and other retailers.

Last year, there were also price increases, but arpu dropped from the prior period’s $56.05 to $55.34 as some recession-hit punters shifted to cheaper plans.

The company said the Crown’s accelerated sale of securities did not affect its full-year outlook or dividend projections.

Cutting costs

Chorus blamed its first-half FY2025 loss on customers downgrading plans, and a drop-off in new property developments due to the tough economy.

This morning, Chorus chief executive Mark Aue said his company had delivered robust financial performance amid a “challenging economic environment”.

Gains had been made from simplifying the business as the firm moves to being an all-fibre operator and “strong capital discipline”, Aue said.

Chorus outlined several areas where it had cut spending in the six months to December 30, 2025 over the year-ago half.

Labour costs were down $2m to $41m.

Network maintenance costs were down $7m to $18m as Chorus continued to decommission fault-prone old copper lines (the company also made a net $3m from the ongoing decommissioning process during the half by selling copper to recyclers).

And spending on consultants was slashed by $4m to $2m.

The savings were partially offset by higher payments to service partners (up $5m to $22m) and IT costs that increased $1m to $21m.

Total fibre connections grew by 31,000 to 1.13m, but the rate of growth slowed with “approximately 10,000 fewer fibre installations”, which helped lower spending.

Fibre uptake has now reached 72.4% of “serviceable addresses” (homes and businesses within reach of the UFB). Chorus aims for 80% by 2030.

Chorus said pent-up demand during the economic slowdown was starting to show in “incoming new property development volumes”. The firm noted building consents were up 9% in the 12 months to December. It had rolled fibre past 11,000 new properties in the first half with more than 23,000 in the pipeline for the second half.

A game of two halves

In the decade after Telecom was split in two, retailer Spark delivered the higher dividends – and indeed the only profit payout during the mid-2010s as Chorus suspended its dividends in the mid-2010s amid the most intense phase of the fibre rollout.

But with the capital-intensive UFB rollout now complete, Chorus has been jacking up its dividend from 25cps.

The UFB network operator reaffirmed its 60cps – Spark has cut its dividend from 25cps in FY2025 to an estimated 16cps.

No Government taste for Chorus adventures

Chorus’ post-UFB rollout life is tightly controlled, including maximum allowable revenue and regulated pricing for its anchor fibre product, with one price increase allowed per year, indexed to the CPI.

The company has put forward two initiatives that could see it bust out of its constraints.

One was the proposed $3.4b 6000km “Tasman Ring” submarine fibre optic cable, which would have represented Chorus’ first foray offshore (and competed with the part-Spark-owned Southern Cross Cables Ltd) and given the South Island its first offshore broadband connection.

Chorus abandoned the project in August last year, while it was still at the drawing board stage, saying pre-sales weren’t stacking up.

The other was a $3b public-private project to extend fibre into rural areas to expand coverage from 87% to 95% of the population.

Extending the “Fibre Frontier” is still officially on the table but Communications Minister Paul Goldsmith has not embraced the idea.

Today, Chorus’ investor presentation lists the rural Public-Private-Partnership (PPP) as one of three “driving strategic opportunities” (along with “copper recycling” and potential property sales).

There is an “ongoing conversation with the Government” but it has “moved down the priority list with lack of government funding”.

Part of the gap is being filled by the free market. Satellite broadband provider Starlink has reached more than 58,000 customers over the past three years, according to Commerce Commission data, with most in rural areas, where Musk’s firm now holds 19% market share according to the regulator.

Forsyth Barr has a neutral rating and a $9.95 12-month target price on the stock.

Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.