By Juby Babu
(Reuters) -Lumen Technologies edged past third-quarter revenue estimate and posted a smaller-than-expected loss on Thursday, driven by demand for its network infrastructure to support massive data flows and computational workloads amid an AI boom.
The telecom and networking firm continues to have an opportunity to expand its share of business revenue, as hyperscalers and enterprise customers ramp up bandwidth demand to support growing AI applications and modernize their core connectivity
infrastructure.
Lumen reported third-quarter revenue of $3.09 billion, compared with analysts' average estimate of $3.04 billion, according to data compiled by LSEG.
The company said it has signed new deals worth $1 billion in October for its private connectivity fabric (PCF) solutions, designed for AI workloads, bringing the total value to more than $10 billion.
The October deal is largely with one client, Chief Financial Officer Chris Stansbury told Reuters in an interview, without naming the customer. There are nearly 15 to 16 customers that add up to the total value, with Lumen seeing more pathways to demand for the PCF product.
In May, the company had agreed to sell its consumer fiber business to AT&T for $5.75 billion to sharpen its enterprise focus and reduce capital expenditure. The deal is expected to close in early 2026.
When the deal closes, Lumen's leverage will be below four times and it will continue to reduce debt, Stansbury said.
"We're not in a position where we have to sell things anymore," Stansbury said. "Our debt is no longer a headwind."
Earlier this month, Lumen and data analytics firm Palantir announced a multi-year partnership aimed at helping businesses deploy AI more quickly and securely. Lumen has also unveiled a series of collaborations with tech firms focused on AI and cybersecurity.
Lumen posted an adjusted loss of 20 cents per share during the third quarter, compared with analysts' estimate of a 27-cent loss. It also reiterated its fiscal 2025 forecast.
(Reporting by Juby Babu in Mexico City; Editing by Shilpi Majumdar)
