Lumen Technologies ( LUMN Quick Quote LUMN - Free Report) has completed the sale of the company’s incumbent local exchange carrier (ILEC) business in 20 states to Brightspeed.
According to the contract, Lumen will retain its national fiber routes and associated networks and its ILEC operations in 16 states. The company will also retain its competitive local exchange carrier networks, national fiber routes, international operations, partnerships and associated networks.
sale was approved by the Federal Communications Commission ("FCC") in August 2022. The FCC approved the transaction with all the necessary final regulatory clearances.
Lumen plans to capitalize on the opportunity for revenue growth from market dynamics such as growth in security, IoT, Big Data, 5G, AI and the demand for edge computing. Also, the sale will allow the company to support its accelerated Quantum Fiber deployment plan.
In August 2022, Lumen announced the sale of its Latin American operations “Cirion” to Stonepeak for $2.7 billion cash. The transaction will allow the company to focus its capital on a strategic mix of assets that will enable long-term growth and debt reduction.
The company continues to invest heavily in its Quantum fiber business and its Enterprise business. The company added 28,000 Quantum Fiber subscribers taking the count to 858,000 at the end of the last-reported quarter.
Recently, the company
announced investing in a fiber pair on a subsea cable system - Grace Hopper - developed by Alphabet Inc. The new system will leverage Lumen’s landing station and infrastructure services to provide data transfer facilities between New York and Bude, Cornwall in the United Kingdom.
Lumen offers a wide array of integrated services like wholesale network access, high-speed Internet access, managed hosting and colocation services etc., to its business and residential customers.
For the third quarter, the Zacks Consensus Estimate for revenues stands at $4.44 billion, down 9.2% year over year. Also, the consensus mark for earnings is pegged at 36 cents per share, down 26.5% year over year.
The company reported adjusted earnings (excluding special items) of 35 cents per share in second-quarter 2022 compared with 48 cents per share in the prior-year quarter.
Quarterly total revenues fell 6.3% year over year to $4,612 million, owing to the conclusion of the CAF II program.
Lumen currently carries a Zacks Rank #3 (Hold). Shares of the company have lost 42.7% compared with the
industry’s decline of 61.1% in the past year. Image Source: Zacks Investment Research Stocks to Consider
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