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Lumen (LUMN) Q1 Earnings Beat Estimates, Revenues Fall Y/Y
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Lumen Technologies, Inc. (LUMN - Free Report) reported mixed first-quarter 2021 results. Adjusted earnings (excluding special items) came in at 63 cents per share compared with 44 cents per share in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 37%.
Quarterly total revenues slipped 7% year over year to $4.676 million, owing to the conclusion of the CAF II program and seasonal factors in its Enterprise business. The top line lagged the consensus estimate by 0.1%.
Segment Performance
By segment, Business revenues fell 5% to $3.401 million due to unfavorable foreign currency impact and the sale of our correctional facilities business.
IGAM revenues declined 2% year over year to $999 million while revenues from Large Enterprise fell 8% to $877 million due to the sale of its correctional facilities communication services business. Mid-Market Enterprise revenues fell 8% to $636 million. Revenues in Wholesale tumbled 4% to $889 million.
Lumen Technologies, Inc. Price, Consensus and EPS Surprise
Revenues from Mass Markets declined 11% year over year to $1.275 million due to a fall in Connect America Fund II revenues.
Lumen anticipates witnessing healthy momentum in Quantum investments and fiber to the home investment strategy to bolster growth of consumer and small business markets in the upcoming quarters. The company added 27,000 Quantum Fiber subscribers taking the count to 830,000 quantum fiber subscribers in the reported quarter. Its fully-funded 2022 Quantum Fiber plan is expected to bolster higher average revenue per user, lower churn and significant customer lifetime value on the back of best-in-breed Quantum experience and product capability.
Other Quarterly Details
Total operating expenses fell 11% year over year to $3,593 million, primarily due to lower depreciation and amortization expenses.
Operating income was $1,083 million, up 10% from the prior-year quarter’s levels. Adjusted EBITDA (excluding special items) slipped to $1.966 billion from $2.165 billion for respective margins of 42% and 43.1%.
Cash Flow & Liquidity
In the first quarter, Lumen generated $1.375 billion of net cash from operations compared with $1.525 billion a year ago.
Free cash flow (excluding cash special items) for the year was $846 million compared with $850 million in the year-ago quarter.
As of Mar 31, 2022, the company had $366 million in cash and cash equivalents with $28,397 million of long-term debt compared with the respective tallies of $354 million and $27,428 million as of Dec 31, 2021.
2022 Outlook
For 2022, Lumen expects adjusted EBITDA in the range of $6.9-$7.1 billion compared with the earlier guidance of $6.5-$6.7 billion.
Free cash flow is projected between $2 billion and $2.2 billion compared with the earlier guided range of $1.6-$1.8 billion.
Capital expenditures are estimated between $3.2 billion and $3.4 billion. The effective income tax rate for the full year is estimated to be nearly 26%.
The Zacks Consensus Estimate for Flex’s fiscal 2023 earnings is pegged at $2.16 per share, up 6.9% in the past 60 days. The long-term earnings growth rate is pegged at 14.9%.
Flex earnings beat the Zacks Consensus Estimate all last four quarters, with the average being 21.1%. Shares of FLEX have declined 2.7% in the past year.
The Zacks Consensus Estimate for Jabil fiscal 2022 earnings is pegged at $7.25 per share, up 10.2% in the past 60 days. The long-term earnings growth rate is 12%.
Jabil earnings beat the Zacks Consensus Estimate all last four quarters, the average being 13.5%. Shares of JBL have gained 14.4% in the past year.
The Zacks Consensus Estimate for Broadcom’s fiscal 2022 earnings is pegged at $35.67 per share, up 1.1% in the past 60 days. AVGO’s long-term earnings growth rate is pegged at 15.6%.
Broadcom’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, with the average being 1.9%. Shares of AVGO have increased 34.6% in the past year.
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Lumen (LUMN) Q1 Earnings Beat Estimates, Revenues Fall Y/Y
Lumen Technologies, Inc. (LUMN - Free Report) reported mixed first-quarter 2021 results. Adjusted earnings (excluding special items) came in at 63 cents per share compared with 44 cents per share in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 37%.
Quarterly total revenues slipped 7% year over year to $4.676 million, owing to the conclusion of the CAF II program and seasonal factors in its Enterprise business. The top line lagged the consensus estimate by 0.1%.
Segment Performance
By segment, Business revenues fell 5% to $3.401 million due to unfavorable foreign currency impact and the sale of our correctional facilities business.
IGAM revenues declined 2% year over year to $999 million while revenues from Large Enterprise fell 8% to $877 million due to the sale of its correctional facilities communication services business. Mid-Market Enterprise revenues fell 8% to $636 million. Revenues in Wholesale tumbled 4% to $889 million.
Lumen Technologies, Inc. Price, Consensus and EPS Surprise
Lumen Technologies, Inc. price-consensus-eps-surprise-chart | Lumen Technologies, Inc. Quote
Revenues from Mass Markets declined 11% year over year to $1.275 million due to a fall in Connect America Fund II revenues.
Lumen anticipates witnessing healthy momentum in Quantum investments and fiber to the home investment strategy to bolster growth of consumer and small business markets in the upcoming quarters. The company added 27,000 Quantum Fiber subscribers taking the count to 830,000 quantum fiber subscribers in the reported quarter. Its fully-funded 2022 Quantum Fiber plan is expected to bolster higher average revenue per user, lower churn and significant customer lifetime value on the back of best-in-breed Quantum experience and product capability.
Other Quarterly Details
Total operating expenses fell 11% year over year to $3,593 million, primarily due to lower depreciation and amortization expenses.
Operating income was $1,083 million, up 10% from the prior-year quarter’s levels. Adjusted EBITDA (excluding special items) slipped to $1.966 billion from $2.165 billion for respective margins of 42% and 43.1%.
Cash Flow & Liquidity
In the first quarter, Lumen generated $1.375 billion of net cash from operations compared with $1.525 billion a year ago.
Free cash flow (excluding cash special items) for the year was $846 million compared with $850 million in the year-ago quarter.
As of Mar 31, 2022, the company had $366 million in cash and cash equivalents with $28,397 million of long-term debt compared with the respective tallies of $354 million and $27,428 million as of Dec 31, 2021.
2022 Outlook
For 2022, Lumen expects adjusted EBITDA in the range of $6.9-$7.1 billion compared with the earlier guidance of $6.5-$6.7 billion.
Free cash flow is projected between $2 billion and $2.2 billion compared with the earlier guided range of $1.6-$1.8 billion.
Capital expenditures are estimated between $3.2 billion and $3.4 billion. The effective income tax rate for the full year is estimated to be nearly 26%.
Zacks Rank & Stocks to Consider
Lumen currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader technology sector are Flex (FLEX - Free Report) , Jabil (JBL - Free Report) and Broadcom (AVGO - Free Report) . All stocks carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
The Zacks Consensus Estimate for Flex’s fiscal 2023 earnings is pegged at $2.16 per share, up 6.9% in the past 60 days. The long-term earnings growth rate is pegged at 14.9%.
Flex earnings beat the Zacks Consensus Estimate all last four quarters, with the average being 21.1%. Shares of FLEX have declined 2.7% in the past year.
The Zacks Consensus Estimate for Jabil fiscal 2022 earnings is pegged at $7.25 per share, up 10.2% in the past 60 days. The long-term earnings growth rate is 12%.
Jabil earnings beat the Zacks Consensus Estimate all last four quarters, the average being 13.5%. Shares of JBL have gained 14.4% in the past year.
The Zacks Consensus Estimate for Broadcom’s fiscal 2022 earnings is pegged at $35.67 per share, up 1.1% in the past 60 days. AVGO’s long-term earnings growth rate is pegged at 15.6%.
Broadcom’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, with the average being 1.9%. Shares of AVGO have increased 34.6% in the past year.