Lumen’s $5.75 B AT&T Sale Cuts $300 M Interest, Debt Falls under $13 B
Lumen sold its fiber-to-home unit to AT&T for $5.75 billion, using $4.8 billion net proceeds to retire super-priority bonds, cut annual interest by $300 million and reduce debt by over $5 billion to under $13 billion. Sale cuts capex by over $1 billion and targets 2026 net interest expense of $650–750 million.
1. Strategic Fiber Business Sale
Lumen sold its Mass Markets fiber-to-home business, including Quantum Fiber across 11 states, to AT&T for $5.75 billion in cash, exiting residential services to concentrate on enterprise digital infrastructure.
2. Debt Reduction and Interest Savings
Management applied $4.8 billion of net proceeds and cash on hand to fully retire super-priority bonds, lowering annual cash interest expense by $300 million and cutting total debt to below $13 billion, a reduction of more than $5 billion since January 2025.
3. Capital Expenditure and Financial Flexibility
The divestiture reduces annual capital spending by over $1 billion and positions Lumen to achieve net cash interest expense of $650–750 million in 2026, freeing resources for enterprise and AI infrastructure investments.
4. Balance Sheet Metrics and Outlook
As of December 31, 2025, Lumen held $1 billion in cash against $17.353 billion of long-term debt and reported $12.4 billion in 2025 revenues; combined with $11 billion of refinancings over the past year, the company is improving leverage ahead of its strategic pivot.