Core Viewpoint - Lumen Technologies has successfully completed a refinancing transaction for Level 3 Financing, Inc., enhancing its financial flexibility and stability to support its transformation efforts [1][2]. Financial Transaction Summary - The refinancing involved replacing all existing term loans under the Credit Agreement with a new $2.4 billion term loan maturing in 2032, priced at Term SOFR + 4.25% [1]. - This refinancing results in a 30-month maturity extension on a blended basis and an interest rate reduction of 231 basis points, leading to annual interest savings exceeding $55 million [1]. - Additional modifications to the covenants in the Credit Agreement were made to provide further flexibility to Level 3 [1]. Company Positioning and Strategy - The company is focused on strengthening its financial position, with this refinancing being a key milestone in fortifying its balance sheet and freeing up capital for long-term growth [2]. - Lumen aims to establish itself as a trusted network for AI, leveraging its financial strength and market momentum to accelerate innovation and create value for customers, employees, and shareholders [2]. Company Overview - Lumen Technologies is dedicated to unleashing the world's digital potential by connecting people, data, and applications efficiently and securely [3]. - The company utilizes its extensive network to help businesses realize the full potential of AI, offering services ranging from metro connectivity to long-haul data transport and edge cloud capabilities [3].

Network trial paves the way for hyperscalers and enterprises to have the bandwidth agility and cost-efficiency needed for AI and next-gen applicationsDENVER, March 27, 2025 /PRNewswire/ -- Lumen Technologies (NYSE: LUMN) and Ciena (NYSE: CIEN) have successfully established a 1.2 terabit wavelength service trial across 3,050 kilometers (more than 1,800 miles) on Lumen's Ultra-Low-Loss (ULL) fiber network, making it the world's longest 1.2 terabit non-regenerated signal.Using 800G interfaces, Lumen and Ciena ...

Group 1 - Lumen Technologies, Inc. has experienced significant revenue contraction in recent years due to past asset sales impacting its business operations [1] - The company has ceased further asset sales, which may stabilize its revenue stream moving forward [1]

Core Viewpoint - Lumen's stock experienced a significant decline due to reports of a potential sale of its consumer fiber business to AT&T, with shares dropping as much as 18.7% during the trading day and closing down 10% [1][2]. Group 1: Potential Sale Impact - AT&T is reportedly considering purchasing Lumen's consumer fiber business for approximately $5.5 billion, which could provide Lumen with much-needed cash to address its debt issues [2][3]. - The sale of the consumer fiber unit is concerning for investors as it represents a strong segment within Lumen's otherwise struggling consumer business, and its loss could weaken the overall business significantly [3][4]. Group 2: Future Implications - If the sale occurs, it may indicate a broader strategic shift for Lumen, potentially leading to further divestitures of its consumer business or even an exit from that market altogether [4]. - Despite the recent stock decline, Lumen's shares have increased by approximately 163% over the past year, driven by growth in fiber sales to cloud hyperscalers like Microsoft and Meta Platforms, particularly in relation to AI data centers [5].

Lumen (LUMN 6.26%) stock is soaring in Friday's trading. The company's share price was up 7.8% as of 3 p.m. ET amid a 0.4% increase for the S&P 500 index and a 0.5% gain for the Nasdaq Composite index.In addition to positive momentum for the broader market, Lumen is getting a big boost from Broadcom's recent earnings report. Broadcom is a designer of connectivity and networking chips and has become a key bellwether for the artificial intelligence (AI) space -- and it just posted better-than-expected quarter ...

Lumen Technologies, Inc.’s (LUMN) shares have surged 175.8% in the past year, outpacing the S&P 500 composite and the Technology Services industry’s growth of 15.1% and 45.1%, respectively.Lumen also outperformed some of its peers like Verizon Communications (VZ) and AT&T (T) , which have registered gains of 11.8% and 55.1%, respectively. Significant increase in AI-fueled connectivity demand has been the driving force behind LUMN stock’s stellar run.Image Source: Zacks Investment ResearchFactors Favoring LU ...

A month has gone by since the last earnings report for Lumen (LUMN) . Shares have added about 3.8% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Lumen due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers. Lumen Posts Better-Than-Expected Q4 EarningsLumen reported fourth ...

Group 1 - Lumen's stock is experiencing an increase due to favorable demand indicators and broader market momentum, with a 6.8% rise noted during trading [1] - The company's valuation is positively impacted by ongoing AI investments from Microsoft and Meta Platforms, which are significant customers of Lumen's Private Connectivity Fabric networking solutions [2] - Despite concerns about potential moderation in AI spending, Microsoft and Meta are aggressively expanding their AI infrastructure, which bodes well for Lumen [3] Group 2 - Microsoft and Meta are preparing to launch new AI offerings for businesses, which will require expanded data center capabilities, creating a favorable demand environment for Lumen [4] - Lumen has secured contracts to provide custom network solutions to Microsoft and Meta, enhancing its exposure to AI trends and shifting the narrative around its stock, despite existing challenges such as high debt [5]

Core Viewpoint - Applied Digital and Lumen Technologies represent two distinct investment opportunities in the growing AI market, with Applied Digital focusing on data centers and Lumen on telecom infrastructure upgrades for AI applications [1][2]. Group 1: Applied Digital - Applied Digital has shifted its focus from blockchain and Bitcoin mining to high-performance computing (HPC) and AI since late 2022, launching a subsidiary, Sai Computing, to cater specifically to AI cloud service providers [3]. - In fiscal 2023, Applied Digital's revenue increased by 548% to $55 million, followed by a 199% growth to $166 million in fiscal 2024, with analysts projecting a further 55% increase to $256 million in fiscal 2025 [4]. - Despite impressive growth rates, Applied Digital remains unprofitable, with an enterprise value of $1.75 billion, translating to 7 times this year's sales, and insiders have purchased nearly twice as many shares as they sold in the past year, indicating potential upside [5]. - The company has a manageable debt-to-equity ratio of 1.1, but its share count has increased by 136% over the past two years due to secondary offerings and stock-based compensation [6]. Group 2: Lumen Technologies - Lumen has focused on expanding its wireline networks and fiber infrastructure rather than entering the wireless market, aiming for steady returns from a slower-growth segment [7]. - Despite efforts to grow its smaller business, Lumen's revenue has declined for six consecutive years, and it reported a high debt-to-equity ratio of 71.2 at the end of 2024 [8]. - Lumen's stock price fell below $1 last June but rebounded as major clients like Microsoft engaged Lumen for AI and cloud data center upgrades, with the total value of these deals reaching $8.5 billion by the end of 2024 [9]. - Analysts expect Lumen's revenue to decline by 6% to $12.4 billion in 2025, but with an enterprise value of $20.4 billion, it may be undervalued at less than 2 times this year's sales, especially if AI contracts revitalize its business [10]. - Lumen's number of outstanding shares has remained stable over the past two years, and insiders have purchased five times as many shares as they sold in the last year [10]. Group 3: Comparative Analysis - Applied Digital is considered a riskier investment but is growing significantly faster and has more direct exposure to the AI market compared to Lumen [12]. - Lumen's AI contracts could mitigate its existing challenges, but it needs to increase spending to meet the demands of large clients, and its high debt levels may restrict its growth potential if interest rates remain high [12].

Company Overview - Lumen Technologies, Inc. has a history stemming from two distinct businesses: an enterprise business focused on connectivity solutions (originating from Level 3) and a consumer-oriented business from CenturyLink [4] - The company emphasizes its role in long-haul networks, intra and intercity connectivity, cloud services, security, and managed services, indicating a shift beyond mere connectivity in the current landscape of multi-cloud and AI [5] Industry Position - Lumen positions itself in a competitive space where connectivity is considered a fundamental requirement, highlighting the importance of evolving services to meet modern demands [5]