Press Release: Lumen Technologies To Attend Investor Conferences

Lumen Technologies, Inc. LUMN reported fourth quarter of 2024 adjusted earnings (excluding special items) of 9 cents per share, which significantly outpaced the Zacks Consensus Estimate of a loss of 8 cents. The company reported earnings per share of 8 cents in the prior-year quarter.

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Quarterly total revenues were $3.329 billion, down 5.4% year over year. This decline was mainly due to the negative impact of divestitures, commercial agreements and the sale of the CDN business. However, the metric beat the Zacks Consensus Estimate by 3.4%.

Lumen Technologies Stock Price, Consensus and EPS Surprise

Lumen Technologies, Inc. price-consensus-eps-surprise-chart | Lumen Technologies, Inc. Quote

For 2024, total revenues were $13.1 billion, down 10% from 2023.

Driven by significant AI-fueled connectivity demand, Lumen secured a total of $8.5 billion in PCF deals in 2024. As AI needs surge, large companies across various industries are urgently seeking fiber capacity, which is becoming highly valuable and potentially scarce. Lumen has inked deals with various tech giants like Microsoft, Amazon, Google Cloud and Meta Platforms to provide the network capabilities for AI innovation. LUMN also remains focused on “cloudifying” telecom and driving the adoption of its network-as-a-service solutions.

The company repaid $1.6 billion of overall debt in 2024 and sent redemption notices for another $200 million of debt recently. LUMN expects $1 billion of operating expenses including network expenses that it plans to eliminate by 2027. In the current year, it expects more than 250 million of run-rate cost benefit.

Lumen (LUMN) reported $3.33 billion in revenue for the quarter ended December 2024, representing a year-over-year decline of 5.4%. EPS of $0.09 for the same period compares to $0.08 a year ago.

The reported revenue represents a surprise of +3.36% over the Zacks Consensus Estimate of $3.22 billion. With the consensus EPS estimate being -$0.08, the EPS surprise was +212.50%.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Lumen performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

• Operating Revenues- Total Business Segment Revenue: $2.66 billion versus $2.55 billion estimated by two analysts on average. Compared to the year-ago quarter, this number represents a -4.6% change.
• Operating Revenues- Total Mass Markets Revenue: $670 million compared to the $669.32 million average estimate based on two analysts. The reported number represents a change of -8.1% year over year.
• Operating Revenues- Total Business Segment Revenue- Wholesale: $716 million versus the two-analyst average estimate of $696.68 million. The reported number represents a year-over-year change of -3.4%.
• Operating revenues- International and Other- Total: $92 million versus the two-analyst average estimate of $93 million.
• Mid-Market Enterprise- Total: $452 million versus the two-analyst average estimate of $469.47 million. The reported number represents a year-over-year change of -7.9%.
• Public Sector- Total: $554 million versus $465.10 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +11.9% change.
• Large Enterprise- Total: $845 million compared to the $826.71 million average estimate based on two analysts. The reported number represents a change of -20.4% year over year.

View all Key Company Metrics for Lumen here>>>

Shares of Lumen have returned -16.3% over the past month versus the Zacks S&P 500 composite's +1% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

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Lumen (LUMN) came out with quarterly earnings of $0.09 per share, beating the Zacks Consensus Estimate of a loss of $0.08 per share. This compares to earnings of $0.08 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 212.50%. A quarter ago, it was expected that this telecommunications would post a loss of $0.20 per share when it actually produced a loss of $0.13, delivering a surprise of 35%.

Over the last four quarters, the company has surpassed consensus EPS estimates two times.

Lumen, which belongs to the Zacks Technology Services industry, posted revenues of $3.33 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.36%. This compares to year-ago revenues of $3.52 billion. The company has topped consensus revenue estimates three times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Lumen shares have lost about 8.3% since the beginning of the year versus the S&P 500's gain of 1.9%.

What's Next for Lumen?

While Lumen has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Lumen: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.25 on $3.11 billion in revenues for the coming quarter and -$0.94 on $12.31 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Technology Services is currently in the top 36% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Another stock from the same industry, Cricut, Inc. (CRCT), has yet to report results for the quarter ended December 2024.

This company is expected to post quarterly earnings of $0.04 per share in its upcoming report, which represents a year-over-year change of -20%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

Cricut, Inc.'s revenues are expected to be $220.46 million, down 4.7% from the year-ago quarter.

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