Lumen updates pro forma after $5.72B fiber asset sale
Lumen Technologies filed an 8-K to present updated unaudited pro forma financial information reflecting its completed sale of the Mass Markets fiber-to-the-home business in 11 states.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Filing Summary
Lumen Technologies filed an 8-K to present updated unaudited pro forma financial information reflecting its completed sale of the Mass Markets fiber-to-the-home business in 11 states. The business was sold to an AT&T subsidiary for $5.75 billion in cash, reduced by about $30 million of adjustments and costs, resulting in roughly $5.72 billion of pre-tax proceeds.
Lumen used these proceeds and cash on hand to redeem several secured note issues and fully repay its superpriority term B credit facility. The pro forma statement of operations for the three months ended March 31, 2026 removes the divested unit and incorporates effects of new commercial and transition service agreements with AT&T, as well as related tax impacts. On this pro forma basis, Q1 2026 revenue is $2.84 billion and the net loss is $222 million.
8-K Event Classification
Key Figures
Key Terms
unaudited pro forma condensed consolidated financial information financial
Purchase Agreement financial
Disposal Group financial
Transition Services Agreement financial
Indefeasible Right to Use technical
Master Services Agreement financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What business did Lumen Technologies (LUMN) sell to AT&T?
How much cash did Lumen Technologies (LUMN) receive from the fiber divestiture?
How did Lumen Technologies (LUMN) use the sale proceeds?
What does the updated pro forma Q1 2026 statement show for Lumen (LUMN)?
Why did Lumen (LUMN) file updated unaudited pro forma financial information?
What gain did Lumen Technologies (LUMN) record on the fiber divestiture?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
| (Address of principal executive offices) | (Zip Code) | |||
(Telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class |
Trading |
Name of Each Exchange on Which Registered | ||
| N/A |
Indicate by check mark whether any registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 8.01 | Other Events. |
As previously reported in the Current Report on Form 8-K filed by Lumen Technologies, Inc. (“Lumen” or the “Company”) on February 2, 2026 (the “Initial Form 8-K”), the Company and its subsidiaries completed the sale of Lumen’s Mass Markets fiber-to-the-home business in Arizona, Colorado, Florida, Idaho, Iowa, Minnesota, Nebraska, Nevada, Oregon, Utah and Washington (the “Business”), for which the Company and its subsidiaries received cash consideration of $5.75 billion, which was reduced by approximately $30 million in closing adjustments and transaction costs, resulting in pre-tax cash proceeds of approximately $5.72 billion. The consideration is subject to further adjustments for working capital and other negotiated purchase price adjustments in the purchase agreement. The Company used the proceeds from the sale and cash on hand to (i) redeem all of the outstanding aggregate principal amount of each of its 10.000% secured notes due 2032, 4.125% superpriority senior secured notes due 2030 and 4.125% superpriority senior secured notes due 2029 and (ii) repay all of the outstanding amounts due under its superpriority term B credit agreement.
On February 4, 2026, the Company amended the Initial Form 8-K to include the financial statements required by Item 9.01(a) and the pro forma financial information required by Item 9.01(b) (the “Amended Form 8-K/A”) and further supplemented the Amended Form 8-K/A with updated pro forma financial information on April 16, 2026 (the “Updated 8-K”).
In connection with the filing of a Registration Statement on Form S-4 by the Company on the date hereof, this Current Report on Form 8-K is being filed to provide updated unaudited pro forma financial information for the three months ended March 31, 2026 (the “Updated Pro Forma Financial Information”). The Updated Pro Forma Financial Information updates and supplements the unaudited pro forma condensed combined financial information of the Company and related disclosures contained in Exhibit 99.2 to the Amended Form 8-K/A and Exhibit 99.1 to the Updated 8-K. To the extent that information in this Current Report on Form 8-K differs from or updates information contained in the Amended Form 8-K/A or the Updated 8-K, the information in this Current Report on Form 8-K shall supersede or supplement the information in the Amended Form 8-K/A and the Updated 8-K.
The Updated Pro Forma Financial Information included in this current Report on Form 8-K has been presented for information purposes only, as required by Form S-4. It does not purport to represent the actual results or project future operating results of the Company following the sale of the Business.
| Item 9.01 | Financial Statements and Exhibits. |
(b) Pro Forma Financial Information.
Attached hereto as Exhibit 99.1 is the following unaudited pro forma consolidated statement of operations for the three months ended March 31, 2026, which reflects the sale of the Business.
2
(d) Exhibits.
The following exhibits are furnished with the above-described Current Report on Form 8-K:
| Exhibit No. |
Description | |
| 99.1 | Unaudited Pro Forma Condensed Consolidated Financial Information of Lumen Technologies, Inc. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL). | |
| * | Pursuant to Item 601(a)(5) of Regulation S-K, certain schedules and other attachments have been omitted from this filing and will be furnished to the Securities and Exchange Commission supplementally upon request. |
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Lumen Technologies, Inc. has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned officer hereunto duly authorized.
| LUMEN TECHNOLOGIES, INC. | ||||||
| Dated: May 20, 2026 | By: | /s/ Chris Stansbury | ||||
| Chris Stansbury | ||||||
| President and Chief Financial Officer | ||||||
4
Exhibit 99.1
LUMEN TECHNOLOGIES, INC.
UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED FINANCIAL INFORMATION
Introduction
On May 21, 2025, Lumen Technologies, Inc. (“Lumen” or “the Company”) and certain of Lumen’s indirect wholly owned subsidiaries (collectively, the “Sellers”), entered into a definitive Purchase Agreement (the “Purchase Agreement”) with Forged Fiber 37, LLC (“Purchaser”), an indirect wholly owned subsidiary of AT&T Inc. (“AT&T”) and AT&T DW Holdings, Inc. (“Guarantor”), to sell Lumen’s Mass Markets fiber-to-the-home business in Arizona, Colorado, Florida, Idaho, Iowa, Minnesota, Nebraska, Nevada, Oregon, Utah and Washington (the “Territory”). On February 2, 2026 (the “Closing Date”), pursuant to the Purchase Agreement as supplemented to date, Lumen completed the sale of its Mass Markets fiber-to-the-home business in the Territory (the “Divestiture”) to the Purchaser in exchange for $5.75 billion of cash consideration, which was reduced by approximately $30 million in closing adjustments and transaction costs, resulting in pre-tax cash proceeds of approximately $5.72 billion. This consideration is further subject to certain post-closing adjustments as set forth in the Purchase Agreement and as supplemented to date.
Since entering into the Purchase Agreement on May 21, 2025, Lumen has classified the assets and liabilities of the Mass Markets fiber-to-the-home business in the Territory (the “Disposal Group”) as held for sale, measured at the lower of (i) the carrying value when Lumen classified the Disposal Group as held for sale and (ii) the fair value of the Disposal Group, less costs to sell. The combined results of operations of the Disposal Group are no longer included in Lumen’s consolidated results of operations beginning February 2, 2026.
The following unaudited pro forma condensed consolidated statement of operations of Lumen for the three months ended March 31, 2026 is presented as if the Divestiture occurred as of January 1, 2025 and gives effect to the elimination of the historical financial results of the Disposal Group due to the Divestiture, as well as other pro forma adjustments. These adjustments also reflect the impact of certain commercial agreements with AT&T and its affiliates entered into at the time of the Divestiture which will have a continuing impact on Lumen’s results, as described in the notes to the unaudited pro forma condensed consolidated statement of operations. No unaudited pro forma condensed combined balance sheet is presented herein as the Divestiture is already reflected in the Company’s most recent consolidated balance sheet as of March 31, 2026 as filed with the U.S. Securities and Exchange Commission (the “SEC”). The unaudited pro forma condensed consolidated statement of operations of Lumen for the year ended December 31, 2025 is included in the Company’s Current Report on Form 8-K filed with the SEC on April 16, 2026.
Lumen prepares its financial statements in accordance with U.S. Generally Accepted Accounting Principles. The following unaudited pro forma statement of operations is based on information currently available including certain assumptions which are subject to change and certain estimates which may not be realized. The pro forma statement of operations is for informational purposes only and is intended to represent what Lumen’s results of operations might have been had the Divestiture occurred on the dates indicated, but not to project Lumen’s financial position or results of operations for any future date or period.
The information in the “Lumen Historical” columns in the following unaudited pro forma statement of operations was derived from Lumen’s historical consolidated financial statements for the period presented and includes the impacts of the gain on disposal of the Mass Markets fiber-to-the-home business in the Territory in the amount of $596 million. Additionally, for the three months ended March 31, 2026, aggregate losses of $226 million resulting from early debt retirements are reflected in the “Lumen Historical” column.
The following unaudited pro forma condensed consolidated statement of operations and the accompanying notes should be read in conjunction with the consolidated financial statements, their accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Lumen’s Quarterly Report on Form 10-Q for the three months ended March 31, 2026.
The information in the “Removal of FttH Business” column in the following unaudited pro forma condensed consolidated statement of operations:
| • | reflects the elimination of the net assets and historical financial performance of the Mass Markets fiber-to-the-home business in the Territory in accordance with rules and regulations of the SEC, |
1
| • | does not reflect what the Disposal Group’s results of operations would have been on a standalone basis, and |
| • | is not intended to represent the Disposal Group’s future capitalization or results of operations. |
The information in the “Pro Forma Adjustments” columns in the unaudited pro forma condensed consolidated statement of operations reflects additional transaction accounting adjustments which have been made in accordance with SEC rules and are further described in the accompanying notes.
The unaudited pro forma condensed consolidated statement of operations has not been adjusted to reflect Lumen’s potential dis-synergies that could result from the Divestiture and, in accordance with applicable SEC rules, do not reflect any nonrecurring transaction or separation expenses that the Company expects to incur after the Divestiture.
The unaudited pro forma condensed consolidated statement of operations has been prepared based upon the best available information and management estimates subject to assumptions described above and in the accompanying notes. The actual financial position and results of operations may materially differ from the pro forma amounts reflected herein due to a variety of factors.
2
LUMEN TECHNOLOGIES, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2026
| Lumen Historical |
Removal of FttH Business |
Pro Forma Adjustments |
Lumen Pro Forma |
|||||||||||||
| (In millions, except per share amounts) | ||||||||||||||||
| OPERATING REVENUE |
$ | 2,899 | (69 | ) | 7 | 2 | 2,837 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| OPERATING EXPENSES |
||||||||||||||||
| Cost of services and products (exclusive of depreciation and amortization) |
1,435 | (3 | ) | 2 | 2 | 1,434 | ||||||||||
| Selling, general and administrative |
794 | (26 | ) | — | 768 | |||||||||||
| Net gain on sale of business |
(596 | ) 5 | — | — | (596 | ) | ||||||||||
| Depreciation and amortization |
664 | — | 4 | — | 664 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total operating expenses |
2,297 | (29 | ) | 2 | 2,270 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| OPERATING INCOME (LOSS) |
602 | (40 | ) | 5 | 567 | |||||||||||
| OTHER (EXPENSE) INCOME |
||||||||||||||||
| Interest expense |
(225 | ) | — | — | (225 | ) | ||||||||||
| Net loss on early retirement of debt |
(226 | ) | — | — | (226 | ) | ||||||||||
| Other income, net |
26 | — | 5 | 1 | 31 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total other (expense) income, net |
(425 | ) | — | 5 | (420 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| INCOME (LOSS) BEFORE INCOME TAXES |
177 | (40 | ) | 10 | 147 | |||||||||||
| Income tax expense (benefit) |
377 | (10 | ) 3 | 2 | 3 | 369 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| NET (LOSS) INCOME |
$ | (200 | ) | (30 | ) | 8 | (222 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| BASIC AND DILUTED (LOSS) INCOME PER SHARE OF COMMON STOCK |
||||||||||||||||
| BASIC |
$ | (0.20 | ) | (0.03 | ) | 0.01 | (0.22 | ) | ||||||||
| DILUTED |
$ | (0.20 | ) | (0.03 | ) | 0.01 | (0.22 | ) | ||||||||
| WEIGHTED AVERAGE COMMON STOCK OUTSTANDING |
||||||||||||||||
| BASIC |
998,891 | — | — | 998,891 | ||||||||||||
| DILUTED |
998,891 | — | — | 998,891 | ||||||||||||
See accompanying notes to the unaudited pro forma condensed consolidated financial information.
3
LUMEN TECHNOLOGIES, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
Notes to the Unaudited Pro Forma Condensed Consolidated Financial Information
Basis of Presentation
The accompanying unaudited pro forma condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the SEC on the basis described under the heading “Introduction.”
Adjustments
Note (1). This adjustment reflects an estimate of the incremental fees Lumen would have received from the Purchaser during the applicable period for providing transition services to the Purchaser and its affiliates in accordance with a Transition Services Agreement entered between the parties on the Closing Date (the “TSA”). Under the TSA, Lumen began providing transition services upon the February 2, 2026 completion date of the Divestiture. This adjustment reflects incremental fees of $5 million that would have been received during the three months ended March 31, 2026 had the Divestiture occurred on January 1, 2025. The transition services are expected to have a recurring impact and are provided for the sole purpose of supporting the operations of the Disposal Group after the Divestiture. The terms of services to be provided under the TSA generally range from six to twenty-four months, subject to the Purchaser’s right to extend the term of certain services for an additional period up to at least twelve months and to terminate early the term of any service.
Note (2). These adjustments reflect an estimate of the aggregate impact of commercial agreements entered into between Lumen (and its affiliates) and the Purchaser (and its affiliates) on the Closing Date of approximately $5 million of additional operating revenue and $2 million of additional operating expense from January 1, 2026 through the Closing Date that would have been realized had the Divestiture occurred on January 1, 2025:
| • | a Master Services Agreement, pursuant to which a Lumen subsidiary will provide various network and communications services to the Purchaser and its affiliates under multi-year arrangements; and |
| • | a Master Services Agreement, pursuant to which an affiliate of the Purchaser will provide various network services to a Lumen subsidiary under multi-year arrangements. |
Additionally, a Lumen subsidiary will provide the Purchaser the right to use specific fibers in Lumen’s retained network infrastructure under an Indefeasible Right to Use (“IRU”) Agreement for an initial term of twenty years with an option to extend under the terms of the arrangement.
In certain of the aforementioned arrangements, Lumen identified contractual terms that are unfavorable compared to prevailing market terms. A transaction price allocation was made for the estimated fair value of unfavorable terms related to the IRU Agreement and other service arrangements under the Master Services Agreement. Lumen recorded $729 million of liabilities for unfavorable commercial agreement components and contractual credits initially measured at fair value, with an offset to the net gain on disposal.
The operating revenue adjustments include revenue of $2 million for the period from January 1, 2026 until the Close Date resulting from the pro forma amortization of the deferred revenue purchase price allocations for these agreements.
Note (3). These adjustments represent an estimate of the tax impact of the Divestiture and the transactions between the parties under the agreements summarized in Notes (1) and (2), as well as the tax impacts corresponding to all other pro forma adjustments noted within. In determining the tax rate to apply for the adjustments under the “Removal of FttH Business” and “Pro Forma Adjustments” headings, the Company used the U.S. statutory and blended state rate in effect for the period presented, which was 24.56% for the three months ended March 31, 2026.
Note (4). Effective with the designation of the Disposal Group as held for sale on May 21, 2025, Lumen suspended recording depreciation of property, plant and equipment while these assets were classified as held for sale. No depreciation or amortization was recognized in the historical period presented for these assets.
4
Note (5). As a result of closing the transaction on February 2, 2026, we derecognized net assets of $4.3 billion, primarily comprised of (i) property, plant and equipment, net of accumulated depreciation, of $2.8 billion, (ii) goodwill of $1.3 billion, and (iii) other net assets of $162 million. During the three months ended March 31, 2026, we recorded a $596 million net pre-tax gain on the disposal. The net gain included in the Lumen Historical column includes the impacts of the liabilities initially established at fair value for unfavorable terms within commercial agreements as described in Note (2) above. Additionally, under the Purchase Agreement, we agreed to reimburse the purchaser for certain matters for which future cash payments by Lumen could be required. Lumen has estimated the fair value of these payments to be $36 million which reduced our net gain on the sale accordingly.
5