Lumen Technologies (LUMN) AI Stock Analysis

• Market Cap: $5.10B
• Dividend Yield: N/A
• Average Volume (3M): 13.51M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.64
• Revenue Growth: -6.50%
• EPS Growth: 43.47%
• Country: US
• Employees: 24,000
• Sector: Communication Services
• Sector Strength: 96
• Industry: Telecommunications Services
• EPS (TTM): -0.03
• Shares Outstanding: 1,026,140,900
• 10 Day Avg. Volume: 14,427,301
• 30 Day Avg. Volume: 13,513,131
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 4.11
• Enterprise Value/Revenue: 1.63
• Enterprise Value/Gross Profit: 3.43
• Enterprise Value/Ebitda: 8.14
• 1Y Price Target: $4.83
• Price Target Upside: 1.68% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

• Rating: 51 Neutral
• Price Target: $4.50 ▼(-5.26% Downside)

Lumen Technologies' overall stock score reflects significant financial challenges, with declining revenues and high leverage being major concerns. However, recent strategic moves, including asset sales and debt refinancing, provide a positive outlook for financial flexibility and future growth. Technical indicators and valuation metrics are mixed, suggesting caution. The most significant positive factors are the strategic initiatives highlighted in the earnings call and corporate events, which could improve the company's financial position over time.

Positive Factors

Financial Performance

Lumen reported generally better core financial performance with business revenue down only 3% yoy, while aggregate EBITDA of $877 million outperformed.

Partnerships

Lumen now has partnerships with Microsoft and AWS, thus now has direct connects with all three cloud providers.

Negative Factors

Risk Factors

Continued risk from declining top line prevents assigning the highest rating despite positive outlook.

Stock Valuation

The stock reacted negatively to the news because the valuation seemed low compared to previous reports.

Lumen Technologies Business Overview & Revenue Model

Company Description

Lumen Technologies (LUMN) is a global technology company that provides communication and data services primarily to business customers. It operates in sectors such as telecommunications, cloud computing, and managed services. Lumen offers a range of products including high-speed internet, voice services, and network solutions, as well as advanced data analytics and security services, catering to the needs of enterprises looking to enhance their digital transformation efforts.

How the Company Makes Money

Lumen Technologies generates revenue through multiple streams, primarily by offering telecommunications services, including local and long-distance voice services, broadband internet, and data networking solutions. The company earns significant income from its enterprise segment, which serves large businesses with customized solutions for data transport, cloud services, and cybersecurity. Additionally, Lumen has developed partnerships with various technology firms to enhance its service offerings, such as integrating cloud solutions with its network infrastructure. The company also leverages its extensive fiber-optic network to provide high-capacity data transport services, which are crucial for businesses seeking reliable connectivity. Overall, its revenue model is built on a combination of subscription-based services, usage-based billing for data services, and long-term contracts with enterprise clients.

Lumen Technologies Financial Statement Overview

Summary

Lumen Technologies faces significant financial challenges, with declining revenues and profitability issues. The balance sheet shows high leverage and potential solvency risks, while cash flow generation remains a concern. The company needs to address these issues to improve its financial health and stability.

Income Statement

Lumen Technologies has experienced declining revenue over recent periods, with a negative revenue growth rate of -1.35% in the TTM. The company has struggled with profitability, as indicated by negative net profit margins and EBIT margins. The gross profit margin has also decreased slightly over time, reflecting challenges in maintaining cost efficiency.

Balance Sheet

The balance sheet reveals significant financial leverage, with a negative stockholders' equity leading to an undefined debt-to-equity ratio in the TTM. This indicates potential solvency issues. The return on equity is negative, reflecting ongoing losses. The equity ratio is also concerning, suggesting a high reliance on debt financing.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth, with a negative growth rate of -7.77% in the TTM. However, the operating cash flow to net income ratio is positive, indicating that the company generates cash from operations despite net losses. The free cash flow to net income ratio is low, reflecting limited cash available after capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.82B	13.11B	14.56B	17.48B	19.69B	20.71B
Gross Profit	6.12B	6.41B	7.41B	9.61B	11.20B	11.78B
EBITDA	2.57B	4.10B	-6.09B	3.58B	8.52B	5.90B
Net Income	-1.18B	-55.00M	-10.30B	-1.55B	2.03B	-1.23B
Balance Sheet
Total Assets	32.98B	33.50B	34.02B	45.58B	57.99B	59.39B
Cash, Cash Equivalents and Short-Term Investments	1.57B	1.89B	2.23B	1.25B	354.00M	406.00M
Total Debt	18.17B	18.16B	20.26B	20.92B	29.37B	32.22B
Total Liabilities	33.57B	33.03B	33.60B	35.14B	46.15B	48.23B
Stockholders Equity	-595.00M	464.00M	417.00M	10.44B	11.84B	11.16B
Cash Flow
Free Cash Flow	938.00M	1.10B	-940.00M	1.72B	3.60B	2.79B
Operating Cash Flow	4.38B	4.33B	2.16B	4.74B	6.50B	6.52B
Investing Cash Flow	-3.28B	-2.83B	-1.20B	5.48B	-2.71B	-3.56B
Financing Cash Flow	-1.03B	-1.85B	-18.00M	-9.31B	-3.81B	-4.25B

Lumen Technologies Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 4.75
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LUMN, the sentiment is Neutral. The current price of 4.75 is above the 20-day moving average (MA) of 4.55, above the 50-day MA of 4.43, and below the 200-day MA of 4.77, indicating a neutral trend. The MACD of 0.17 indicates Negative momentum. The RSI at 54.31 is Neutral, neither overbought nor oversold. The STOCH value of 35.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LUMN.

Lumen Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TKC	81 Outperform	$4.79B	11.04	7.38%	5.84%	19.25%	5.69%
PHI	70 Neutral	$4.34B	7.60	27.07%	8.53%	0.35%	19.08%
AD	61 Neutral	$4.54B	―	-0.54%	43.78%	-3.65%	-134.04%
Sector *	60 Neutral	$46.60B	4.09	-13.11%	4.12%	1.85%	-42.71%
TEO	56 Neutral	$3.71B	22.47	-0.27%	2.39%	3.89%	-107.44%
TDS	55 Neutral	$4.26B	―	-0.81%	0.40%	-5.62%	80.09%
LUMN	51 Neutral	$5.10B	―	-78.94%	―	-6.50%	43.47%

Lumen Technologies Corporate Events

Lumen Technologies Announces $425M Note Offering

On September 4, 2025, Lumen Technologies announced that its subsidiary, Level 3 Financing, plans to offer an additional $425 million of 7.000% First Lien Notes due 2034 in a private offering. The proceeds will be used to redeem existing notes and cover related expenses. Additionally, Lumen expects to amend its New Credit Agreement to establish a new tranche of term loans and make other adjustments, though this is subject to market conditions.

Lumen Technologies Completes $2 Billion Note Offering

On August 18, 2025, Level 3 Financing, a subsidiary of Lumen Technologies, completed a $2 billion offering of 7.000% First Lien Notes due 2034. The proceeds were used to redeem existing notes and reduce interest expenses, aligning with Lumen’s strategy to simplify its capital structure, extend maturities, and enhance financial flexibility. This move is expected to strengthen Lumen’s position in delivering high-performance digital network services, crucial for enterprises and public sector organizations in the AI-driven economy.

Lumen Technologies Increases Private Offering to $2 Billion

On August 4, 2025, Lumen Technologies announced that its subsidiary, Level 3 Financing, planned a private offering of $2 billion in First Lien Notes due 2034, an increase from the initially proposed $1.25 billion. The proceeds will be used to redeem existing notes and pay related expenses, impacting the company’s financial structure and stakeholder interests.

Lumen Technologies Reports Q2 2025 Results and Sells Fiber Business

On July 31, 2025, Lumen Technologies reported its second quarter 2025 results, highlighting strong revenue and Adjusted EBITDA despite a significant net loss due to a non-cash goodwill impairment charge. The company announced the sale of its consumer fiber business to AT&T for $5.75 billion, aiming to sharpen its enterprise focus and improve financial flexibility. Lumen also completed a $2 billion bond offering to extend debt maturities and reduce interest expenses, while increasing its cost-reduction target to support growth reinvestment.

Lumen Technologies Completes $2 Billion Notes Offering

On June 30, 2025, Lumen Technologies‘ subsidiary, Level 3 Financing, completed a $2 billion upsized offering of 6.875% First Lien Notes due 2033. The proceeds were used to redeem existing notes and reduce interest expenses, aligning with Lumen’s strategy to simplify its capital structure and enhance financial flexibility. This move is part of Lumen’s broader effort to reposition itself as a leader in digital network services, crucial for supporting AI-driven business transformations.

Lumen Technologies Increases Private Offering to $2 Billion

On June 16, 2025, Lumen Technologies announced that its subsidiary, Level 3 Financing, planned a private offering of $2.0 billion in First Lien Notes due 2033, an increase from the initially planned $1.0 billion. The proceeds will be used to redeem existing senior secured notes and pay related expenses, with the offering expected to close by June 30, 2025, subject to customary conditions.