Company Performance - Cogent Communications reported a quarterly loss of $1.21 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.93, and compared to a loss of $0.75 per share a year ago, indicating a significant decline in performance [1] - The company posted revenues of $246.25 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.28%, but down from $260.44 million in the same quarter last year [2] - Over the last four quarters, Cogent has surpassed consensus EPS estimates two times and topped consensus revenue estimates just once [2] Stock Movement and Outlook - Cogent shares have lost approximately 43.1% since the beginning of the year, contrasting with the S&P 500's gain of 7.9% [3] - The company's earnings outlook is crucial for determining future stock movements, with current consensus EPS estimates at -$0.79 for the coming quarter and -$3.51 for the current fiscal year [4][7] - The estimate revisions trend for Cogent was favorable ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, suggesting it is expected to outperform the market in the near future [6] Industry Context - The Wireless National industry, to which Cogent belongs, is currently in the top 35% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Cogent's performance [5]

[Q2 2025 Earnings Release Overview](index=1&type=section&id=Q2%202025%20Earnings%20Release%20Overview) Cogent Communications announced Q2 2025 financial results, showing improved EBITDA and continued capital allocation through dividends and share repurchases [Financial and Business Highlights](index=1&type=section&id=Financial%20and%20Business%20Highlights) Cogent Communications reported Q2 2025 service revenue of $246.2 million, with strong Wavelength and IPv4 growth, and significant sequential and year-over-year increases in EBITDA and Adjusted EBITDA Service Revenue Performance | Metric | Q2 2025 ($ millions) | Q1 2025 ($ millions) | Q2 2024 ($ millions) | Sequential Change (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Service Revenue | $246.2 | $247.0 | $260.4 | -0.3% | -5.5% | | Wavelength Revenue | $9.1 | $7.1 | $3.6 | +27.2% | +149.8% | | IPv4 Revenue | $15.3 | $14.4 | $10.9 | +6.3% | +40.1% | EBITDA & Margin Performance | Metric | Q2 2025 ($ millions) | Q1 2025 ($ millions) | Q2 2024 ($ millions) | Sequential Change (pp) | YoY Change (pp) | | :--- | :--- | :--- | :--- | :--- | :--- | | EBITDA | $48.5 | $43.8 | $27.1 | +10.8% | +78.8% | | EBITDA Margin | 19.7% | 17.7% | 10.4% | +2.0 | +9.3 | | Adjusted EBITDA | $73.5 | $68.8 | $106.2 | +6.9% | -30.8% | | Adjusted EBITDA Margin | 29.8% | 27.8% | 40.8% | +2.0 | -11.0 | [Capital Allocation Updates](index=1&type=section&id=Capital%20Allocation%20Updates) Cogent increased its regular quarterly dividend for the 52nd consecutive quarter and expanded its stock buyback program by $100 million - Quarterly Dividend: Increased by **$0.005 per share** to **$1.015 per share** for Q3 2025 (from $1.010 for Q2 2025), marking the **fifty-second consecutive quarterly dividend increase**[2](index=2&type=chunk) - Stock Buyback Program: Purchased **229,507 shares** for **$11.5 million** in Q2 2025 and increased the program by **$100.0 million**, extending through December 31, 2026[2](index=2&type=chunk) [Detailed Quarterly Financial Performance](index=2&type=section&id=Detailed%20Quarterly%20Financial%20Performance) This section provides an in-depth analysis of Cogent's Q2 2025 service revenue, profitability metrics, and cash flow performance [Service Revenue Analysis](index=2&type=section&id=Service%20Revenue%20Analysis) Cogent's total service revenue for Q2 2025 was $246.2 million, a slight sequential decrease. While on-net revenue increased, off-net and non-core revenues declined. Wavelength and IPv4 leasing revenues continued their strong growth trends - Total Service Revenue: **$246.2 million** for Q2 2025, a decrease of **0.3% sequentially** and **5.5% from Q2 2024**. On a constant currency basis, service revenue decreased by **1.3% sequentially** and **6.0% year-over-year**[3](index=3&type=chunk)[4](index=4&type=chunk) Revenue by Service Type (Q2 2025) | Service Type | Revenue ($ millions) | Sequential Change (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | | On-net revenue | $132.3 | +2.1% | -6.0% | | Off-net revenue | $102.2 | -4.8% | -8.3% | | Wavelength revenue | $9.1 | +27.2% | +149.8% | | Non-core revenue | $2.7 | -10.0% | -41.3% | | IPv4 leasing revenue | $15.3 | +6.3% | +40.1% | - Revenue under the Commercial Agreement (Sprint acquisition) was **$1.1 million** for Q2 2025, an increase from **$0.7 million** in Q1 2025 but a decrease from **$5.9 million** in Q2 2024[3](index=3&type=chunk) [Gross Profit and Operating Cash Flow](index=3&type=section&id=Gross%20Profit%20and%20Operating%20Cash%20Flow) GAAP gross profit remained stable sequentially at $33.5 million, while Non-GAAP gross profit saw a slight decrease. Net cash used in operating activities significantly increased in Q2 2025 compared to Q1 2025 and Q2 2024 - GAAP Gross Profit: **$33.5 million** for Q2 2025, a **0.3% sequential decrease** but a **10.7% increase from Q2 2024**. GAAP gross margin was **13.6%** for Q2 2025, stable sequentially and up from **11.6%** in Q2 2024[10](index=10&type=chunk)[11](index=11&type=chunk) - Non-GAAP Gross Profit: **$109.3 million** for Q2 2025, a **0.8% sequential decrease** but a **4.4% increase from Q2 2024**. Non-GAAP gross margin was **44.4%** for Q2 2025, down slightly from **44.6%** in Q1 2025 but up from **40.2%** in Q2 2024[12](index=12&type=chunk)[13](index=13&type=chunk) Net Cash from Operating Activities | Metric | Q2 2025 ($ millions) | Q1 2025 ($ millions) | Q2 2024 ($ millions) | | :--- | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(44.0) | $36.4 | $(22.2) | - Sprint acquisition costs were **$0** in Q1 2025 and Q2 2025, compared to **$12.4 million** in Q2 2024[14](index=14&type=chunk) [EBITDA and Net Loss](index=4&type=section&id=EBITDA%20and%20Net%20Loss) EBITDA and Adjusted EBITDA both increased sequentially in Q2 2025, with corresponding margin improvements. However, the company reported an increased net loss per share EBITDA & Margin (Q2 2025) | Metric | Q2 2025 ($ millions) | Q1 2025 ($ millions) | Q2 2024 ($ millions) | Sequential Change (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | EBITDA | $48.5 | $43.8 | $27.2 | +10.8% | +78.3% | | EBITDA Margin | 19.7% | 17.7% | 10.4% | +2.0 pp | +9.3 pp | Adjusted EBITDA & Margin (Q2 2025) | Metric | Q2 2025 ($ millions) | Q1 2025 ($ millions) | Q2 2024 ($ millions) | Sequential Change (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Adjusted EBITDA | $73.5 | $68.8 | $106.2 | +6.9% | -30.8% | | Adjusted EBITDA Margin | 29.8% | 27.8% | 40.8% | +2.0 pp | -11.0 pp | Net Loss Per Share (Q2 2025) | Metric | Q2 2025 ($ per share) | Q1 2025 ($ per share) | Q2 2024 ($ per share) | | :--- | :--- | :--- | :--- | | Basic and Diluted Net Loss per Share | $(1.21) | $(1.09) | $(0.68) | - Cash payments under the IP Transit Services Agreement were **$25.0 million** for Q2 2025, consistent with Q1 2025, but down from **$66.7 million** in Q2 2024[16](index=16&type=chunk) [Operational and Strategic Developments](index=5&type=section&id=Operational%20and%20Strategic%20Developments) This section outlines Cogent's customer and network expansion, optical wave service developments, and ongoing shareholder return initiatives [Customer and Network Growth](index=5&type=section&id=Customer%20and%20Network%20Growth) Total customer connections decreased, primarily driven by off-net and non-core segments, while on-net and wavelength customer connections continued to grow. The number of on-net buildings also increased Customer Connections (as of June 30, 2025) | Metric | June 30, 2025 (number) | March 31, 2025 (number) | June 30, 2024 (number) | QoQ Change (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total customer connections | 118,730 | 120,731 | 128,782 | -1.7% | -7.8% | | On-net customer connections | 87,407 | 86,781 | 87,387 | +0.7% | +0.02% | | Off-net customer connections | 26,239 | 27,508 | 32,758 | -4.6% | -19.9% | | Wavelength customer connections | 1,469 | 1,322 | 754 | +11.1% | +94.8% | | Non-core customer connections | 3,615 | 5,120 | 7,883 | -29.4% | -54.1% | - The number of on-net buildings increased by **29** from Q1 2025 to **3,529** as of June 30, 2025, and increased by **143** from Q2 2024[22](index=22&type=chunk) [Optical Wave Network Expansion](index=5&type=section&id=Optical%20Wave%20Network%20Expansion) Leveraging the Sprint network acquisition, Cogent has expanded its optical wavelength services, now offered in 938 data centers across North America - Cogent expanded its product offerings to include optical wavelength services using predominantly owned fiber acquired from the Sprint network. As of June 30, 2025, these services are offered in **938 data centers** in the United States, Mexico, and Canada[23](index=23&type=chunk) [Dividend and Share Repurchase Program](index=5&type=section&id=Dividend%20and%20Share%20Repurchase%20Program) Cogent's Board approved its 52nd consecutive quarterly dividend increase and significantly boosted its stock buyback program, demonstrating a continued commitment to shareholder returns - Quarterly Dividend: The Board approved a regular quarterly dividend of **$1.015 per share** for Q3 2025, an increase of **$0.005 (0.5%)** from Q2 2025, and an annual increase of **3.0%** from Q3 2024. This marks the **fifty-second consecutive quarterly dividend increase**[24](index=24&type=chunk) - Stock Buyback Program: In Q2 2025, Cogent purchased **229,507 shares** for **$11.5 million** at an average price of **$50.18 per share**. In July 2025, an additional **63,487 shares** were purchased for **$3.1 million**. The Board approved a **$100.0 million increase** to the buyback program, extending through December 31, 2026[27](index=27&type=chunk) [Company Information](index=6&type=section&id=Company%20Information) Cogent Communications is a multinational, Tier 1 facilities-based ISP, providing high-speed Internet access, Ethernet transport, optical wavelength, optical transport, and colocation services globally - Cogent Communications is a multinational, Tier 1 facilities-based ISP specializing in high-speed Internet access, Ethernet transport, optical wavelength, optical transport, and colocation services[29](index=29&type=chunk) - The company's facilities-based, all-optical IP network backbone provides services in **302 markets globally**[29](index=29&type=chunk) [Summary of Financial and Operational Results (Tables)](index=7&type=section&id=Summary%20of%20Financial%20and%20Operational%20Results%20(Tables)) This section presents comprehensive quarterly tables detailing Cogent's revenue, profitability, cash flow, and key operational metrics [Revenue and Profitability Trends](index=7&type=section&id=Revenue%20and%20Profitability%20Trends) This section provides a detailed quarterly breakdown of Cogent's revenue streams, including on-net, off-net, wavelength, and non-core, along with GAAP and Non-GAAP gross profit and margins, highlighting recent performance and trends Service Revenue Breakdown (Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | On-Net revenue | $138,624 | $140,757 | $136,485 | $128,760 | $129,628 | $132,331 | | Off-Net revenue | $118,178 | $111,451 | $111,291 | $113,190 | $107,274 | $102,177 | | Wavelength revenue | $3,327 | $3,625 | $5,287 | $6,966 | $7,119 | $9,057 | | Non-Core revenue | $6,039 | $4,610 | $4,139 | $3,375 | $3,027 | $2,682 | | **Service revenue – total** | **$266,168** | **$260,443** | **$257,202** | **$252,291** | **$247,048** | **$246,247** | | IPv4 Revenue | $10,151 | $10,938 | $11,236 | $12,560 | $14,413 | $15,320 | Gross Profit & Margin (Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP gross profit | $26,344 | $30,240 | $9,835 | $29,836 | $33,571 | $33,465 | | GAAP gross margin | 9.9% | 11.6% | 3.8% | 11.8% | 13.6% | 13.6% | | Non-GAAP gross profit | $97,620 | $104,626 | $96,119 | $97,585 | $110,099 | $109,261 | | Non-GAAP gross margin | 36.7% | 40.2% | 37.4% | 38.7% | 44.6% | 44.4% | [EBITDA and Cash Flow Trends](index=9&type=section&id=EBITDA%20and%20Cash%20Flow%20Trends) This section details the quarterly trends for EBITDA, Adjusted EBITDA, net cash from operating activities, and capital expenditures, providing insight into the company's operational efficiency and investment activities EBITDA & Adjusted EBITDA (Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | EBITDA | $18,452 | $27,126 | $35,861 | $41,853 | $43,759 | $48,495 | | EBITDA margin | 6.9% | 10.4% | 13.9% | 16.6% | 17.7% | 19.7% | | EBITDA, as adjusted | $114,989 | $106,163 | $60,861 | $66,853 | $68,759 | $73,495 | | Adjusted EBITDA margin | 43.2% | 40.8% | 23.7% | 26.5% | 27.8% | 29.8% | Net Cash from Operating Activities & Capital Expenditures (Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $19,219 | $(22,171) | $(20,226) | $14,532 | $36,351 | $(44,039) | | Capital expenditures | $40,883 | $48,767 | $59,244 | $46,104 | $58,088 | $56,200 | [Customer and Network Metrics](index=10&type=section&id=Customer%20and%20Network%20Metrics) This section provides a detailed overview of customer connections by type, on-net building counts, and network infrastructure metrics, illustrating the company's operational scale and reach Customer Connections (Q1 2024 - Q2 2025, end of period) | Metric | Q1 2024 (number) | Q2 2024 (number) | Q3 2024 (number) | Q4 2024 (number) | Q1 2025 (number) | Q2 2025 (number) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | On-Net customer connections | 87,574 | 87,387 | 87,655 | 87,500 | 86,781 | 87,407 | | Off-Net customer connections | 34,579 | 32,758 | 32,420 | 28,963 | 27,508 | 26,239 | | Wavelength customer connections | 693 | 754 | 1,041 | 1,118 | 1,322 | 1,469 | | Non-Core customer connections | 10,037 | 7,883 | 5,217 | 5,802 | 5,120 | 3,615 | | **Total customer connections** | **132,883** | **128,782** | **126,333** | **123,383** | **120,731** | **118,730** | On-Net Buildings (Q1 2024 - Q2 2025, end of period) | Metric | Q1 2024 (number) | Q2 2024 (number) | Q3 2024 (number) | Q4 2024 (number) | Q1 2025 (number) | Q2 2025 (number) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Multi-Tenant office buildings | 1,861 | 1,864 | 1,870 | 1,871 | 1,867 | 1,871 | | Carrier neutral data center buildings | 1,376 | 1,393 | 1,410 | 1,423 | 1,453 | 1,471 | | Cogent data centers | 78 | 86 | 95 | 104 | 101 | 101 | | Cogent edge data centers | 6 | 43 | 49 | 55 | 79 | 86 | | **Total on-net buildings** | **3,321** | **3,386** | **3,424** | **3,453** | **3,500** | **3,529** | | Wave enabled data centers | 295 | 516 | 657 | 808 | 883 | 938 | Network Metrics (Q1 2024 - Q2 2025, end of period) | Metric | Q1 2024 (miles/AS's) | Q2 2024 (miles/AS's) | Q3 2024 (miles/AS's) | Q4 2024 (miles/AS's) | Q1 2025 (miles/AS's) | Q2 2025 (miles/AS's) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Intercity route miles – Leased | 76,211 | 75,965 | 77,561 | 79,621 | 79,867 | 73,075 | | Metro route miles – Leased | 25,977 | 27,373 | 28,510 | 29,802 | 30,788 | 31,297 | | Intercity route miles – Owned | 21,883 | 21,883 | 21,883 | 21,883 | 21,883 | 21,883 | | Metro route miles – Owned | 1,704 | 1,704 | 1,704 | 1,704 | 1,704 | 1,704 | | Connected networks – AS's | 8,098 | 8,135 | 8,212 | 8,250 | 8,240 | 8,085 | [Non-GAAP Measures and Supplemental Information](index=12&type=section&id=Non-GAAP%20Measures%20and%20Supplemental%20Information) This section provides detailed explanations, reconciliations, and definitions for Cogent's non-GAAP financial measures and key leverage ratios [Notes to Financial and Operational Results](index=12&type=section&id=Notes%20to%20Financial%20and%20Operational%20Results) This section provides detailed explanations and definitions for various financial and operational metrics presented in the summary tables, including classifications related to the Sprint acquisition, gross profit calculations, and specific expense exclusions - Wavelength Services: Cogent began providing optical wavelength and transport services over its fiber network in connection with the Wireline Business acquisition[40](index=40&type=chunk) - Non-Core Revenue: Consists of legacy services from companies whose assets or businesses were acquired by Cogent, which are supported but not actively sold[41](index=41&type=chunk) - GAAP Gross Profit/Margin: Defined as total service revenue less network operations expense, depreciation and amortization, and equity-based compensation included in network operations expense[43](index=43&type=chunk) - Non-GAAP Gross Profit/Margin: Represents service revenue less network operations expense, excluding equity-based compensation and depreciation/amortization. Management uses this to measure network efficiency[44](index=44&type=chunk) - Sprint Acquisition Costs: **$9.0 million** in Q1 2024 and **$12.4 million** in Q2 2024, with **no costs incurred** in Q3 2024, Q4 2024, Q1 2025, or Q2 2025[14](index=14&type=chunk)[45](index=45&type=chunk) - IP Transit Services Agreement: TMUSA will pay Cogent an aggregate of **$700.0 million**, with **$25.0 million** paid in Q1 2025 and Q2 2025[16](index=16&type=chunk)[53](index=53&type=chunk) - Owned Fiber Useful Life Change: On July 1, 2024, Cogent changed the estimated useful life of its owned fiber from an average of **14 years** to an average of **40 years**[54](index=54&type=chunk) [EBITDA Reconciliations](index=16&type=section&id=EBITDA%20Reconciliations) This section defines EBITDA and Adjusted EBITDA, explaining their relevance as non-GAAP measures for evaluating the company's ability to service debt, fund capital expenditures, and expand its business, along with their reconciliation to net cash provided by operating activities - EBITDA is defined as net cash flows provided by operating activities plus changes in operating assets and liabilities, cash interest expense, and cash income tax expense[56](index=56&type=chunk) - EBITDA, as adjusted, includes Sprint acquisition costs and cash payments made to the Company under the IP Transit Services Agreement[56](index=56&type=chunk) EBITDA and Adjusted EBITDA Reconciliation (Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $19,219 | $(22,171) | $(20,226) | $14,532 | $36,351 | $(44,039) | | **EBITDA** | **$18,452** | **$27,126** | **$35,861** | **$41,853** | **$43,759** | **$48,495** | | PLUS: Sprint acquisition costs | $9,037 | $12,370 | $0 | $0 | $0 | $0 | | PLUS: Cash payments under IP Transit Services Agreement | $87,500 | $66,667 | $25,000 | $25,000 | $25,000 | $25,000 | | **EBITDA, as adjusted** | **$114,989** | **$106,163** | **$60,861** | **$66,853** | **$68,759** | **$73,495** | [Constant Currency Revenue Reconciliations](index=18&type=section&id=Constant%20Currency%20Revenue%20Reconciliations) This section provides reconciliations of service revenue to constant currency figures, both sequentially and year-over-year, and further adjusts for excise tax impacts, offering a clearer view of underlying revenue growth trends unaffected by foreign exchange fluctuations or tax changes Constant Currency Revenue Growth (Sequential, Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Service revenue, as reported | $266,168 | $260,443 | $257,202 | $252,291 | $247,048 | $246,247 | | Constant currency revenue percent increase (decrease) | -2.3% | -2.0% | -1.5% | -1.5% | -1.9% | -1.3% | Constant Currency and Excise Tax Impact on Revenue Growth (Sequential, Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Service revenue, as reported | $266,168 | $260,443 | $257,202 | $252,291 | $247,048 | $246,247 | | Constant currency and excise tax revenue percent increase (decrease) | -2.3% | -1.5% | -1.7% | -2.0% | -1.6% | -1.2% | [Non-GAAP Gross Profit Reconciliations](index=20&type=section&id=Non-GAAP%20Gross%20Profit%20Reconciliations) This section reconciles GAAP gross profit to Non-GAAP gross profit, detailing the adjustments for equity-based compensation and depreciation/amortization, providing a clearer view of the company's network efficiency Non-GAAP Gross Profit Reconciliation (Q1 2024 - Q2 2025, in thousands) | Metric | Q1 2024 ($ thousands) | Q2 2024 ($ thousands) | Q3 2024 ($ thousands) | Q4 2024 ($ thousands) | Q1 2025 ($ thousands) | Q2 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Service revenue total | $266,168 | $260,443 | $257,202 | $252,291 | $247,048 | $246,247 | | GAAP Gross Profit | $26,344 | $30,240 | $9,835 | $29,836 | $33,571 | $33,465 | | Plus - Equity-based compensation – network operations expense | $385 | $350 | $469 | $477 | $490 | $506 | | Plus – Depreciation and amortization expense | $70,891 | $74,036 | $85,815 | $67,272 | $76,038 | $75,290 | | **Non-GAAP Gross Profit** | **$97,620** | **$104,626** | **$96,119** | **$97,585** | **$110,099** | **$109,261** | | GAAP Gross Margin | 9.9% | 11.6% | 3.8% | 11.8% | 13.6% | 13.6% | | Non-GAAP Gross Margin | 36.7% | 40.2% | 37.4% | 38.7% | 44.6% | 44.4% | [Leverage Ratios](index=21&type=section&id=Leverage%20Ratios) This section defines and presents various leverage ratios, including gross, net, and indenture-specific ratios, both unadjusted and adjusted for amounts due from T-Mobile, providing insights into the company's debt levels relative to its earnings and assets Leverage Ratios (as of Q2 2025, in thousands) | Metric | March 31, 2024 ($ thousands) | June 30, 2024 ($ thousands) | Sept 30, 2024 ($ thousands) | Dec 31, 2024 ($ thousands) | March 31, 2025 ($ thousands) | June 30, 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total debt | $1,467,516 | $1,882,429 | $1,938,571 | $1,994,386 | $2,024,537 | $2,335,557 | | Total net debt | $1,304,242 | $1,456,188 | $1,622,479 | $1,766,470 | $1,840,567 | $2,028,832 | | Trailing 12 months EBITDA, as adjusted | $411,001 | $463,102 | $392,525 | $348,392 | $302,636 | $269,968 | | Gross leverage ratio | 3.57 | 4.06 | 4.94 | 5.72 | 6.69 | 8.65 | | Net leverage ratio | 3.17 | 3.14 | 4.13 | 5.07 | 6.08 | 7.52 | | Gross leverage ratio, adjusted for amounts Due from T-Mobile | 2.64 | 3.37 | 4.16 | 4.91 | 5.81 | 7.74 | | Net leverage ratio, adjusted for amounts Due from T-Mobile | 2.24 | 2.45 | 3.36 | 4.25 | 5.21 | 6.61 | Leverage Ratios under Company's Indentures (as of Q2 2025, in thousands) | Metric | March 31, 2024 ($ thousands) | June 30, 2024 ($ thousands) | Sept 30, 2024 ($ thousands) | Dec 31, 2024 ($ thousands) | March 31, 2025 ($ thousands) | June 30, 2025 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total debt | $1,342,896 | $1,676,552 | $1,732,697 | $1,788,507 | $1,818,661 | $1,955,287 | | Consolidated Leverage Ratio | 3.51 | 4.50 | 5.11 | 5.81 | 5.86 | 6.82 | | Secured Leverage Ratio | 2.33 | 2.49 | 2.90 | 3.38 | 2.58 | 4.20 | | Fixed Charge Coverage Ratio | 4.05 | 4.06 | 3.85 | 2.88 | 2.80 | 2.43 | - Consolidated Cash Flow under the Company's **$600.0 million** Secured 2032 Notes includes cash payments under the IP Transit Services Agreement with TMUSA, which totaled **$100.0 million** for the most recently completed four fiscal quarters[75](index=75&type=chunk) [Condensed Consolidated Financial Statements](index=24&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Cogent's condensed consolidated balance sheets, statements of comprehensive loss, and statements of cash flows for the reported periods [Condensed Consolidated Balance Sheets](index=24&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Cogent's total assets increased to $3.27 billion, driven by growth in property and equipment. Total liabilities also increased to $3.22 billion, primarily due to new debt issuances, while stockholders' equity decreased Key Balance Sheet Items (as of June 30, 2025 vs. Dec 31, 2024, in thousands) | Metric | June 30, 2025 ($ thousands) | Dec 31, 2024 ($ thousands) | Change ($ thousands) | | :--- | :--- | :--- | :--- | | Total current assets | $560,971 | $482,101 | +$78,870 | | Total property and equipment, net | $1,725,382 | $1,664,167 | +$61,215 | | Total assets | $3,270,531 | $3,173,102 | +$97,429 | | Total current liabilities | $243,286 | $253,336 | -$10,050 | | Total liabilities | $3,223,863 | $2,950,254 | +$273,609 | | Total stockholders' equity | $46,668 | $222,848 | -$176,180 | - Debt structure changes include the reduction of Senior Secured 2026 Notes to **$0**, a new issuance of Senior Secured 2032 Notes for **$597.9 million**, and an increase in Secured IPv4 Notes to **$370.5 million**[78](index=78&type=chunk) [Condensed Consolidated Statements of Comprehensive Loss](index=25&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) For Q2 2025, Cogent reported an increased net loss of $57.8 million, primarily due to higher interest expense and a loss on debt extinguishment, despite a decrease in total operating expenses. The six-month period also showed an increased net loss Three Months Ended June 30, 2025 vs. 2024 (in thousands) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | Change ($ thousands) | | :--- | :--- | :--- | :--- | | Service revenue | $246,247 | $260,443 | -$14,196 | | Total operating expenses | $277,706 | $310,918 | -$33,212 | | Operating loss | $(31,459) | $(47,143) | +$15,684 | | Interest expense (incl. swap) | $(39,777) | $(29,541) | -$10,236 | | Loss on debt extinguishment | $(5,606) | $0 | -$5,606 | | Gain on bargain purchase – Sprint | $0 | $27,673 | -$27,673 | | Net loss | $(57,807) | $(32,338) | -$25,469 | | Basic/Diluted Net Loss per Share | $(1.21) | $(0.68) | -$0.53 | Six Months Ended June 30, 2025 vs. 2024 (in thousands) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | Change ($ thousands) | | :--- | :--- | :--- | :--- | | Service revenue | $493,298 | $526,613 | -$33,315 | | Total operating expenses | $565,045 | $636,481 | -$71,436 | | Operating loss | $(71,747) | $(106,536) | +$34,789 | | Interest expense (incl. swap) | $(73,971) | $(58,703) | -$15,268 | | Net loss | $(109,849) | $(97,645) | -$12,204 | | Basic/Diluted Net Loss per Share | $(2.30) | $(2.06) | -$0.24 | [Condensed Consolidated Statements of Cash Flows](index=27&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In Q2 2025, net cash used in operating activities increased significantly. Investing activities shifted to net cash used, primarily due to increased property and equipment purchases. Financing activities provided substantial cash, driven by new debt issuances and debt extinguishment Three Months Ended June 30, 2025 vs. 2024 (in thousands) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(44,039) | $(22,171) | | Net cash (used in) provided by investing activities | $(31,200) | $25,889 | | Net cash provided by financing activities | $193,754 | $255,595 | | Purchases of property and equipment | $(56,200) | $(48,767) | | Dividends paid | $(49,560) | $(93,304) | | Net proceeds from issuance of senior secured 2032 notes | $597,842 | $0 | | Debt extinguishment and redemption – 2026 notes | $(505,000) | $0 | Six Months Ended June 30, 2025 vs. 2024 (in thousands) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(7,687) | $(2,951) | | Net cash (used in) provided by investing activities | $(64,288) | $76,840 | | Net cash provided by financing activities | $136,739 | $232,046 | | Purchases of property and equipment | $(114,288) | $(89,650) | | Dividends paid | $(98,693) | $(93,782) | [Forward-Looking Statements](index=29&type=section&id=Forward-Looking%20Statements) This section contains a standard disclaimer on forward-looking statements, highlighting potential risks and uncertainties that could affect actual results - Statements in the release are forward-looking, based on current beliefs and expectations, and subject to **significant risks and uncertainties**[85](index=85&type=chunk) - Risk factors include the impact of the Wireline Business acquisition (integration difficulties, transition costs), future economic instability (recession, bank failures), changing foreign exchange rates, legal and operational difficulties in new markets, potential Universal Service Fund contributions, changes in government policy/regulation (net neutrality, data protection), cyber-attacks, increasing competition, ability to attract/retain customers, peering arrangements, reliance on equipment vendors, dependence on third-party fiber, debt payment ability, and litigation outcomes[85](index=85&type=chunk) - Cogent undertakes **no duty to update** any forward-looking statement or any information contained in this press release or other public disclosures[85](index=85&type=chunk)

Financial Performance - Service revenue for Q2 2025 was $246.2 million, a decrease of 0.3% from Q1 2025 and a decrease of 5.5% from Q2 2024 [2] - EBITDA increased by 10.8% to $48.5 million for Q2 2025 from Q1 2025 and increased by 78.8% from $27.1 million for Q2 2024 [1][14] - GAAP gross profit decreased by 0.3% to $33.5 million for Q2 2025, but increased by 10.7% from Q2 2024 [8] - Non-GAAP gross profit decreased by 0.8% to $109.3 million for Q2 2025, while it increased by 4.4% from Q2 2024 [10] Revenue Breakdown - On-net revenue was $132.3 million for Q2 2025, an increase of 2.1% from Q1 2025 but a decrease of 6.0% from Q2 2024 [4] - Off-net revenue was $102.2 million for Q2 2025, a decrease of 4.8% from Q1 2025 and a decrease of 8.3% from Q2 2024 [5] - Wavelength revenue was $9.1 million for Q2 2025, an increase of 27.2% from Q1 2025 and an increase of 149.8% from Q2 2024 [6][15] - Revenue from leasing IPv4 addresses was $15.3 million for Q2 2025, an increase of 6.3% from Q1 2025 and an increase of 40.1% from Q2 2024 [15] Customer Metrics - Total customer connections decreased by 7.8% from June 30, 2024, to 118,730 as of June 30, 2025 [18] - On-net customer connections increased by 0.02% from June 30, 2024, to 87,407 as of June 30, 2025 [18] - Off-net customer connections decreased by 19.9% from June 30, 2024, to 26,239 as of June 30, 2025 [18] - Wavelength customer connections increased by 11.1% sequentially from Q1 2025 [18] Dividend and Stock Buyback - Cogent approved an increase of $0.005 per share to its regular quarterly dividend for a total of $1.015 per share for Q3 2025, marking the fifty-second consecutive quarterly dividend increase [21] - In Q2 2025, Cogent purchased 229,507 shares of its common stock for $11.5 million at an average price of $50.18 per share under its buyback program [23] - An additional 63,487 shares were purchased in July 2025 for $3.1 million at an average price of $48.13 per share [23] Strategic Developments - The acquisition of Sprint has allowed Cogent to construct a wavelength network, expanding its product offerings to include optical wavelength services [20] - As of June 30, 2025, Cogent was offering optical wavelength services in 938 data centers across the United States, Mexico, and Canada [20]

Group 1 - Cogent Communications Holdings, Inc. will host a conference call on August 7, 2025, at 8:30 a.m. (ET) to present its operating results for the second quarter of 2025 [1] - A press release with the operating results will be issued at 7:00 a.m. (ET) on the same day [1] - The conference call is accessible via dial-in numbers for U.S. and Canadian callers as well as international callers, with a recommendation to join 15 minutes early [1] Group 2 - Cogent is a facilities-based provider of low-cost, high-speed Internet access and private network services, operating in 292 markets globally [2] - The company is headquartered in Washington, D.C., and offers services primarily to bandwidth-intensive businesses [2] - Additional information about Cogent can be found on its website [2]

Company Overview - Cogent's network carries approximately 20% of all Internet traffic, serving 206 markets across North America, Europe, Asia, Latin America, and Australia[9] - The company serves over 87,200 customer connections, with 69% of revenues from Corporate end users and 31% from Service Provider customers[9] - Cogent focuses on selling Dedicated Internet Access and IP Connectivity, operating a network spanning from Helsinki, Finland to Sydney, Australia[12] Network Infrastructure - The network includes over 58,000 route miles of intercity fiber and over 36,000 miles of intracity fiber in 206 metro markets[12] - Cogent's network is interconnected with over 7,040 different networks and connected to 1,054 data center buildings and 1,769 corporate multi-tenant office buildings[12, 15] - The company has agreements with over 250 building owners (REITs) and operates 54 Cogent data centers with over 606,000 square feet[15] Market Dynamics and Pricing - In the corporate market, the most common On-Net product is 1,000 Mbps for $900/month with a multi-year contract, with typical customers using approximately 12% of purchased capacity[22] - In the NetCentric market, the average price per Mbps was $0.58 in Q4 2019 and $0.53 in Q1 2020, with new sales averaging $0.28 and $0.20 respectively[22] Financial Performance - The company's On-Net revenue for Q1 2020 was $103.5 million, representing a 6.5% year-over-year increase[62] - Off-Net revenue for Q1 2020 was $37.3 million, a decrease of 0.4% quarter-over-quarter[62] - Total revenue for Q1 2020 reached $140.9 million, a 5.1% year-over-year increase[62] - Non-GAAP Gross Margin for Q1 2020 was 60.5%, and EBITDA as adjusted was $50.4 million, representing a 35.8% margin[62] Capital Allocation - Cogent purchased $14 billion of original investment for $60 million through strategic acquisitions[39] - The company has been returning capital to shareholders through share buybacks and dividends, with cumulative totals reaching significant levels from 2005 to Q1 2020[67]

Company Overview - Cogent operates a global network carrying over 20% of all internet traffic[10] - The company provides high-speed internet access, with 69% of revenues from corporate clients and 31% from netcentric clients[10] - Cogent operates in 47 countries across 207 markets[10] Market Opportunity - The potential corporate market includes over 126000 connections[18] - Cogent wins approximately 40% of all corporate proposals[18] - Cogent's network is interconnected with over 7130 access networks[45] Network Infrastructure - The company's network includes over 58000 intercity fiber route miles[45] - Cogent owns 54 data centers with over 606000 square feet[45] - Cogent's network utilization is approximately 30%[45] Financial Performance - In Q2 2020, On-Net revenue was $103.8 million and Off-Net revenue was $37 million[65] - The Non-GAAP Gross Margin in Q2 2020 was 62%[65] - The company has returned over $800 million to shareholders since its IPO[66] Capital Allocation - In 2019, $24 million (43%) of capital expenditure was allocated to new markets, MTOBs, and data centers, while $32.1 million (57%) was for maintenance[64] - Cogent purchased $14 billion of original investment for $60 million through acquisitions[50, 51]

Company Overview - Cogent operates a global network carrying over 20% of all internet traffic[9] - The company's revenue is divided into Corporate (67%) and Netcentric (33%) segments[9] - Cogent operates in 47 countries across 208 markets[9] Market Opportunity - Cogent wins approximately 40% of all proposals in the corporate market[18] - The company interconnects with over 7,220 access networks[42] - Cogent's network has access to approximately 50,000 corporate connections primarily in North America[45] Financial Performance - In Q3 2020, On-Net revenue was $105.1 million, Off-Net revenue was $37.1 million, and Non-Core revenue was $0.1 million[62] - Total revenue in Q3 2020 reached $142.3 million, representing a 3.9% year-over-year increase[62] - Non-GAAP Gross Margin in Q3 2020 was 61.9%[62] - EBITDA as adjusted for Q3 2020 was $54.7 million, with a margin of 38.4%[62] Network Infrastructure - Cogent has agreements with over 250 building owners (REITs)[42] - The company owns 54 data centers with over 606,000 square feet[42] - Cogent's network includes over 58,000 intercity fiber route miles[42]

Company Overview - Cogent operates a global network carrying over 20% of all internet traffic[10] - The company's revenue is segmented into Corporate (65%) and Netcentric (35%)[10] - Cogent operates in 47 countries across 202 markets[10] Market Opportunity - Cogent estimates a potential market of over 91,000 MTOB tenants for its corporate opportunity[18] - The company wins approximately 40% of all proposals in the corporate market[18] - Cogent interconnects with over 7,330 access networks for its Netcentric customers[44] Financial Performance - In Q4 2020, On-Net revenue was 44% and Off-Net revenue was 56% of total revenue[40] - In Q4 2020, Corporate revenue was 65% and NetCentric revenue was 35% of total revenue[40] - Cogent has returned over $895 million to shareholders since its IPO[65] - Cogent's On-Net ARPU was $465 and Off-Net ARPU was $1,026 in Q4 2020[57] - In Q4 2020, On-Net Revenue was $107.1 million, Off-Net Revenue was $36.7 million, and Total Revenue was $143.9 million[64]

Company Overview - Cogent operates a global network carrying over 20% of all internet traffic[10] - The company serves two customer bases: Corporate (63% of revenues) and Netcentric (37% of revenues)[10] - Cogent operates in 48 countries across 210 markets[10] Market Opportunities - Corporate market: Cogent wins approximately 40% of all proposals[18] - Corporate market: Potential market of over 91,000 MTOB tenants[18] - Netcentric market: Cogent prices new services at 50% of market price[27] Network and Infrastructure - Cogent's network has capacity of up to 2,800 Gbps in North America and up to 3,200 Gbps in Europe[42] - The company is interconnected with 7,470+ access networks[43] - Cogent has 2,939 On-Net buildings, including 1,796 multi-tenant office buildings[43] Financial Performance - In Q1 2021, On-Net revenue was $109.9 million, a 6.3% year-over-year increase[62] - In Q1 2021, Total revenue was $146.8 million, a 4.2% year-over-year increase[62] - In Q1 2021, EBITDA as adjusted Margin was 37.9%[62] - Since its IPO, Cogent has returned over $931 million to shareholders[63]

Company Overview - Cogent operates a global network carrying over 20% of all internet traffic[10] - The company operates its network in 48 countries across 210 markets[10] - Cogent's customer base is segmented into Corporate (61% of revenues) and Netcentric (39% of revenues)[10] Market Opportunity & Strategy - Cogent wins approximately 40% of all proposals in the corporate market[19] - Cogent prices new Netcentric services at 50% of the market rate[26] - The company's network is approximately 29% utilized, indicating substantial network capacity[41] Financial Performance & Capital Allocation - In Q2 2021, On-Net revenue accounted for 74% and Off-Net revenue accounted for 18% of the total revenue[38] - In Q2 2021, the On-Net Corporate revenue was 51% and On-Net NetCentric revenue was 49%[38] - Cogent has improved its EBITDA and Adjusted Gross Margin consistently over 20 years at approximately 200 bps per annum[61] - Cogent's Q2 2021 Non-GAAP Gross Margin was 62.1%[60, 73] - Cogent's Q2 2021 EBITDA margin was 38.7%[60, 72] - Cogent has returned over $1 billion to shareholders since its 2005 public offering[61]