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Lumen Technologies, Inc. LUMN has announced a definitive agreement to sell its Mass Markets fiber-to-the-home business, including Quantum Fiber, across 11 states to AT&T for $5.75 billion in cash, subject to subject to working capital and other various purchase price adjustments. This transaction marks an important move in Lumen’s ongoing transformation into a leading digital enterprise networking company.
The transaction is expected to close in the first half of 2026, pending regulatory approvals and customary closing conditions.
What Does This Divestiture Offer?
The sale, which includes roughly 95% of Quantum Fiber in approximately 4 million fiber-enabled locations and close to 1 million subscribers as of March 31, 2025, is expected to contribute more than $750 million in annualized revenues, based on first-quarter figures. AT&T’s scale and consumer-centric strategy are expected to further accelerate the growth of this business.
Net proceeds from the deal, estimated at approximately $4.2 billion, combined with existing cash, will be used by LUMN to retire about $4.8 billion in super priority debt. This is expected to lower annual interest expenses by $300 million and reduce the company’s projected 2025 net debt to adjusted EBITDA ratio from 4.9 to 3.9. The deal will also reduce annual capital expenditures related to Mass Markets fiber by about $1 billion, allowing Lumen to reinvest in enterprise offerings and strengthen its balance sheet.
Lumen Technologies, Inc. Price and Consensus
Lumen Technologies, Inc. price-consensus-chart | Lumen Technologies, Inc. Quote
The company also retains its existing copper network, which mainly services consumer customers. Lumen plans to continue new fiber buildouts at a similar pace as in 2024 through the end of 2025.
Lumen aims to expand its intercity fiber network to 47 million miles by 2028. The company will also focus on growing the Lumen Digital Platform to deliver simpler, faster and more secure networking solutions for business customers. Lumen also intends to strategically integrate its physical infrastructure with its digital capabilities to boost network performance, scalability, intelligence and security via innovative architectures like Direct Fiber Access, Cloud On-ramps, and Multicloud Gateways.
Management highlighted that the transaction provides it with increased financial flexibility to reimagine enterprise networking in a multi-cloud, artificial intelligence (AI)-first world. Lumen will retain its core infrastructure assets, including its national and regional fiber backbone, central offices and real estate, which will serve as the foundation for its enterprise services. Its wholesale and enterprise fiber customers will remain under Lumen across all markets.