Cogent’s Wavelength Revenue Surges 74% with On-Net Sales at 61% Mix
Cogent’s wavelength revenue rose 74% year-over-year to $12.1 million in Q4 and reached $38.5 million for 2025 as on-net revenue climbed to 61% of total from 47%. Gross margin rose 100 bps to 46.8%, adjusted EBITDA improved 140 bps to 31.9%.
1. Wavelength Business Growth
Cogent’s wavelength business generated $12.1 million in Q4, up 74% year-over-year and 19% sequentially, with full-year wavelength revenue doubling to $38.5 million as connections rose 18% sequentially to 2,064 and on-net coverage expanded to 1,096 locations.
2. Revenue Mix Shift
On-net revenue accounted for 61% of total sales in Q4, up from 47% a year ago, as off-net revenue declined 17.9% year-over-year to $92.9 million, reflecting continued migration to higher-margin on-net products and sunsetting of low-margin contracts.
3. Profitability Improvements
Gross margin improved by 100 basis points to 46.8%, driven by cost reductions and product mix optimization, while adjusted EBITDA rose 140 basis points to 31.9%, supporting full-year EBITDA excluding IP transit payments of $192.8 million and margin expansion to 19.8%.
4. Balance Sheet and Capital Plans
Cogent reported gross debt of $2.4 billion and net debt of $1.9 billion with leverage ratios improving to 7.35 and 6.64, respectively, and plans to refinance $750 million of 2027 notes alongside securing 23 monthly $8.3 million T-Mobile payments.