Q2 2024 Lumen Technologies Inc Earnings Call Transcript
Key Points
- Lumen Technologies Inc (LUMN) has secured over $5 billion in major partnerships, with visibility to nearly $7 billion more in opportunities, positioning itself as a trusted network for AI.
- The company reported a 26% year-over-year increase in North American large enterprise and mid-market sales, with new logo sales up 10% and net total contract value for all channels up nearly 40%.
- Lumen Technologies Inc (LUMN) achieved significant improvements in customer satisfaction, with transaction Net Promoter Scores rising across all enterprise customer channels.
- The company is making progress in its Quantum Fiber business, with record fiber net additions of 40,000 in Q2 and surpassing 1 million fiber subscribers in July.
- Lumen Technologies Inc (LUMN) announced a path to creating $1 billion in cost takeout by the end of 2027 through strategic infrastructure simplification in network, product portfolio, and IT.
- Total reported revenue declined 10.7% year-over-year to $3.268 billion, with significant impacts from divestitures and commercial agreements.
- Adjusted EBITDA was $1.011 billion, down from $1.229 billion in the year-ago quarter, with a 30.9% margin and free cash flow was negative $156 million.
- The company expects 2025 EBITDA to be below 2024 levels due to investments in transformation and costs associated with recent PCF sales.
- Revenue from legacy services continues to decline, with large enterprise revenue down 6.9% and mid-market revenue down approximately 7% year-over-year.
- The company faces challenges in managing multiple networks and systems, with plans to consolidate from four enterprise networks to one and reduce product codes and billing systems significantly.
Greetings, and welcome to Lumen Technologies second-quarter 2024 earnings call. (Operator instructions) And as a reminder, this conference is being recorded.
I would now like to turn the conference over to Jim Breen, Senior Vice President, Investor Relations. Jim, please go ahead.
Good afternoon, everyone, and thank you for joining Lumen Technologies second-quarter 2024 earnings call. On the call today are Kate Johnson, President and Chief Executive Officer; and Chris Stansbury, Executive Vice President and Chief Financial Officer.
Before we begin, I need to call your attention to our Safe Harbor statement on slide 1 of our second quarter 2024 presentation, which notes that this conference call may include forward-looking statements subject to certain risks and uncertainties. All forward-looking statements should be considered in conjunction with the cautionary statements and the risk factors in our SEC filings.
We will be referring to certain non-GAAP
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