The Path Forward

Lumen is transforming for growth

We continue to take deliberate actions to optimize our cost structure, improve financial performance, and position the company to deliver sustainable value. We are pleased to have reached an agreement with creditors to extend maturities and give the company more runway for our turnaround. We believe our proactive approach to refinance our debt and divest parts of our business will improve our agility and efficiency, enabling us to better compete in the markets we serve.

We believe our customers will benefit from the changes we have made, as the changes will give us significantly more flexibility to innovate for growth and bring new capabilities to the market. They will provide greater agility and efficiency to meet customer needs.

We have a stronger foundation, long-term prospects and a deep commitment to serving our customers. We are confident we will execute a successful transformation to better serve our customers well into the future.

We have a purposeful journey ahead, and we are confident in our future.

Snapshot
Q&As

Enhanced ability to execute strategy. We reached an agreement with creditors to extend maturities on a large portion of our debt to 2029 and 2030. The agreement, subject to completion, will also provide us with $1.2 billion of new financing. This, in addition to the $1.5 billion in net proceeds from the EMEA sale and an approximate $900 million cash tax benefit, will bolster our liquidity, and help reduce our debt. Simply put, we are playing to win.
Reshaped the company to focus on your experience. We’ve taken actions to simplify our operations, including the continuous streamlining of our delivery processes. This will ensure we are best positioned to provide you with the customer experience you deserve.
Continued to innovate for growth. We are bringing new capabilities such as Network-As-A-Service, or NaaS, to the market. We’re cloudifying telecom and expanding our service offerings to meet your complex and evolving needs.
Built partnerships. The strategic relationship we have established with Colt will enable Lumen to continue to deliver a seamless experience for our multinational customers with needs in EMEA – and we are continuing to invest in our partner ecosystem.
Demonstrated our conviction in Lumen. We continue to be excited by our future potential. As a testament to management’s confidence in the future of the organization, our CEO, Kate Johnson, has purchased 1 million Lumen shares, our Chief Financial Officer, Chris Stansbury, has purchased 500,000 shares and our Chief People Officer, Ana White has purchased 500,000 shares.

Download the letter from Chris Stansbury

Q&As

You recently filed multiple 8-Ks, and a 10-Q [and are close to closing your Colt transaction]. What is happening with Lumen?

Lumen is in a deep transformation, and we have taken deliberate steps to put Lumen on a path to growth by refinancing our debt and optimizing our cost structure.
The agreement we reached with our creditors gives the company even more runway for our turnaround.
In addition, Colt and Lumen have established a strategic relationship that will enable Lumen to continue to deliver a seamless experience for our multinational customers with needs in EMEA.
We have also made the difficult decision to reshape our business and reduce our workforce.
Our proactive approach to addressing our debt maturities, divesting parts of our business, and creating strong partnerships across the globe will help us drive focus.
We have a purposeful journey ahead, and we are confident in our future.
Overall, we expect these steps will accelerate our transformation.

What does this mean about the state of Lumen’s business operations?

We are reshaping our structure to support our business model and growth moving forward.
We will continue to transform our operations and product portfolio.
We believe we have strengthened our financial position while sharpening our strategic focus.
We have a purposeful journey ahead, and we are confident in our future.

What does this mean about Lumen’s financial situation?

We believe we are in a strong position from both a cash and debt perspective.
We expect to see revenue and EBITDA stabilization by the end of 2024, and growth after that.
Our path forward continues to be simplifying the business, strengthening our financials, and transforming Lumen.

What does this mean for vendors and business partners?

Lumen continues to take deliberate actions to optimize its cost structure, improve financial performance, and position the company to deliver sustainable value.
We’re continuing to operate as usual and are focused on working as a team to meet and exceed our customers’ expectations.
We value our relationship and look forward to continuing our work with you.

What does this mean for customers?

We’re continuing to operate as usual and are laser-focused on meeting your needs.
Our global value proposition remains unchanged: We will continue to meet your application and data needs.
We have a purposeful journey ahead, and we are confident in our future. Thank you for your continued support.

What happens next?

In terms of next steps, we anticipate that the ratings agencies could temporarily downgrade Lumen’s rating or put the company in selective default as we continue through the process of executing the transaction.
There is no actual “default.” This is fairly typical for such situations, which the agencies apply based on their criteria for similar situations of large-scale debt exchanges.
We expect any potential rating change to be temporary, and the rating agencies will reassess our ratings once our agreement with our creditors is executed.
Importantly, this does not affect our agreement, our employees, or our ability to meet our obligations. It also has no impact on how we will continue working with our customers and business partners.
Our path forward continues to be simplifying the business, strengthening our financials, and transforming Lumen.

This may include forward-looking statements (as defined by the federal securities laws), which are subject to the “safe harbor” protections thereunder. These forward-looking statements are not guarantees of future results and are based on current expectations only, are inherently speculative, and are subject to a number of assumptions, risks and uncertainties, many of which are beyond our control. Actual events and results may differ materially from those anticipated, estimated, projected or implied by us in those statements. Factors that could affect actual results include, but are not limited to, each of the matters and risks referenced from time to time in our filings with the U.S. Securities and Exchange Commission. We undertake no obligation to publicly update or revise any forward-looking statements for any reason, which speak only as of the date made.