Lumen Beats Q3 Adjusted EPS and EBITDA, Affirms FY26 Guide, but Revenue Falls 12% to $2.72B

Lumen Technologies (LUMN) reported third-quarter 2026 revenue of $2.72 billion, down 12% from a year earlier and just below the $2.73 billion estimate, while adjusted EPS of -$0.14 beat the -$0.23 estimate. Adjusted EBITDA of $715 million topped the $686 million estimate, and the company affirmed its fiscal 2026 guidance.

Q3 scorecard

By our calculation, adjusted EPS beat the estimate by 9 cents and adjusted EBITDA beat it by $29 million, while revenue was about $10 million below. Third-quarter 2025 revenue was $3.087 billion and GAAP diluted EPS was -$0.62. Second-quarter 2026 revenue was $2.805 billion and GAAP diluted EPS was -$0.20.

Segments and Strategic revenue

• Business. Business segment revenue was $2.35 billion, down 4% from a year earlier.
• Mass Markets. Mass Markets revenue was $369 million, down 42% from a year earlier.
• Strategic revenue. Strategic revenue was $1.28 billion, up 10% from a year earlier. Strategic sales rose 30% year over year, and Strategic Waves sales rose 22% from the prior quarter.

Profit and cash flow

• GAAP result. GAAP diluted EPS was -$0.26, against adjusted EPS of -$0.14. Special items totaled $121 million net of tax.
• Adjusted EBITDA. The $715 million figure excludes $194 million of special items.
• Free cash flow. Free cash flow was negative $354 million, compared with positive $69 million in the second quarter of 2026.

Outlook

• FY26 guidance. Lumen affirmed fiscal 2026 adjusted EBITDA of $3.1 billion to $3.3 billion, a $3.2 billion midpoint against the $3.19 billion estimate, and free cash flow of $1.9 billion to $2.1 billion.
• Management view. The company said AI-driven demand for connectivity is fueling momentum in its Strategic revenue base. It said it remains on track to deliver an adjusted EBITDA inflection this year and a return to business revenue growth in 2028.

Network-as-a-Service and AI connectivity

• NaaS. Network-as-a-Service (NaaS) has more than 4,000 customers. Active customers rose 24% and active ports rose 38%.
• Private Connectivity Fabric. Lumen has signed $700 million of Private Connectivity Fabric (PCF) deals year to date, bringing cumulative agreements to more than $13.5 billion.
• Intelligent Internet. The Intelligent Internet footprint covers more than 10 million U.S. locations.

What to watch

• Cash flow. Whether free cash flow moves toward the $1.9 billion to $2.1 billion full-year range after a negative third quarter.
• Mass Markets. How far the 42% revenue decline weighs on total revenue as Strategic revenue grows 10%.
• Business revenue. Progress toward the stated return to business revenue growth in 2028.
• Related coverage. See our reports on TeraWulf and AI infrastructure stocks.

Sources: Results are from Lumen's third-quarter 2026 report. Estimates are consensus figures. Prior-year and second-quarter 2026 comparison figures are from the company's earlier releases. Items labeled by our calculation are our own arithmetic. This article is informational only and is not investment advice.

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