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Lumen Technologies: From Legacy Decline to Digital Expansion—A High-Stakes Transformation Underway!

Lumen Technologies reported its fourth quarter and full-year 2025 financial results, marking a significant transition driven largely by the recent completion of its fiber-to-the-home divestiture to AT&T for $5.75 billion. This transaction materially reshaped the company’s capital structure, reducing total debt to under $13 billion and lowering net leverage below 4x, which in turn decreased annual interest expenses by approximately $500 million compared to 2025. Concurrently, capital expenditures are expected to decline by over $1 billion in 2026 due to ceasing fiber-to-the-home builds, enabling a strategic refocus on enterprise digital services and AI-oriented network infrastructure. The 2025 results showed an 8.7% revenue decline year-over-year to $3.041 billion, with business segment revenues down 8.8% and adjusted EBITDA totaling $767 million (25.2% margin), both within guidance expectations. Free cash flow was negative $765 million in the quarter, impacted by a delayed $400 million tax refund expected in early 2026.