Lumen Technologies Stock Soars Again on AI Enthusiasm

Lumen Technologies (LUMN) shares soared for a second straight session Wednesday after the telecom provider reported better-than-expected results and a huge jump in its full-year free cash flow guidance as it capitalizes on the artificial intelligence (AI) boom.

Lumen posted a second-quarter loss of $0.05 per share, smaller than consensus estimates of analysts polled by Visible Alpha. Revenue fell 10.7% to $3.27 billion, but it also beat forecasts.

CEO Says Lumen in Position ‘To Help Drive the AI Growth Wave’

Chief Executive Officer (CEO) Kate Johnson said the “rising demand of AI is requiring greater connectivity between data centers,” and Lumen is in position “to help drive the AI growth wave.” She added the company is “confident in our future growth and business transformation as we look to enable the AI economy.”

AI was also behind Lumen’s stock jump Tuesday, when it said that it had picked up $5 billion in new business for its AI connectivity products, and was in active talks with customers for an additional $7 billion in AI sales opportunities.

In its earnings report, Lumen raised its 2024 free cash flow outlook to a range of $1.0 billion to $1.2 billion from its previous prediction of $100 million to $300 million. However, it lowered its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) expectation to a range of $3.9 billion to $4.0 billion from $4.1 billion to $4.3 billion. 

Shares of Lumen Technologies jumped 39% to $6.95 as of 12:15 p.m. ET Wednesday and have soared more than 160% since Monday’s close.