Lumen Technologies Inc
Q2 2026 Earnings
Market Reaction
Did LUMN Beat Earnings? Q2 2026 Results
Lumen Technologies delivered a stronger-than-expected second quarter, posting an adjusted loss of $0.07 per share against a consensus estimate of $0.14, a 50.53% beat, while revenue of $2.81 billion topped forecasts by 2.35%, even as total sales declined 9.3% year-over-year. The top-line softness was largely explained by the Q1 2026 divestiture of its Mass Markets Fiber-to-the-Home business to AT&T, which contributed to a 40% collapse in Mass Markets revenue to $361 million, though the broader business segment held up more resiliently with only a 1.8% decline. The more telling detail was the continued shift in revenue mix toward strategic products, which grew 14.1% year-over-year to represent 53% of total business revenue, reflecting Lumen's push to reposition itself as an AI-era enterprise infrastructure platform, a narrative reinforced by its recent acquisition of Alkira. Free cash flow swung to positive $327 million from negative $209 million a year ago, and Lumen reiterated its full-year adjusted EBITDA outlook of $3.10 billion to $3.30 billion.
- Strategic revenue increased to 53% of total business revenue, up from 51% in Q1 2026 and 45% in Q2 2025
- Large Enterprise revenue grew 3.7% YoY to $794 million
- Public Sector revenue grew 1.4% YoY to $490 million
- Operating cash flow increased to $971 million from $570 million YoY
- Interest expense declined 41% YoY to $201 million due to debt reduction
- Free Cash Flow excluding Special Items improved to $327 million from $(209) million YoY
- Adjusted EBITDA margin excluding special items improved 20 bps to 28.6%
“Lumen is putting innovation back where it belongs - inside the network itself. By embedding digital intelligence directly into the physical network layer, we're delivering higher-impact business outcomes instead of competing on price alone. That's a fundamentally different value proposition in enterprise networking, and a new chapter for Lumen customers and investors.”
Lumen Technologies CEO, on the earnings call
Forward Guidance & Outlook
Lumen reiterated its full-year 2026 financial outlook: Adjusted EBITDA excluding Special Items of $3.1 to $3.3 billion; Free Cash Flow excluding Special Items of $1.9 to $2.1 billion (includes $729 million of Mass Markets FTTH divestiture proceeds classified as cash flow from operations); Net Cash Interest of $650 to $750 million; Capital Expenditures excluding Special Items of $3.2 to $3.4 billion; Cash Income Taxes refund of ($350) to ($450) million (reflecting a $400 million refund from recent tax legislation, excluding taxes related to the Mass Markets FTTH divestiture). Additional outlook ranges include income tax expense of $45 to $200 million, total other expense net of $1.1 to $1.3 billion, depreciation and amortization expense of $2.6 to $2.8 billion, and stock-based compensation expense of $60 to $80 million.
LUMN YoY Financials
LUMN Revenue by Segment
LUMN Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.