Lumen sold its copper and consumer fiber to pay down debt and pivot to AI networking
After CEO Kate Johnson took over in 2022, Lumen sold assets, restructured $15B of debt out of court and bet its fiber network on AI traffic.
What was changed
In an April 2026 CNBC analysis, Lumen Technologies is described as having narrowly skirted bankruptcy. For years the company, formerly CenturyLink, had invested billions in a fiber network, and the spending cut into profits until its stock was measured in pennies. CEO Kate Johnson, who arrived in 2022, says her mission was to take assets that had been commoditised and restore their value.
The steps: Lumen sold its incumbent local carrier operations to Apollo Funds in 2022; completed a $15 billion debt restructuring in early 2024, when its stock was around $1; and closed the $5.75 billion sale of its mass-markets fiber-to-the-home business to AT&T in February 2026, with most proceeds retiring debt. Johnson called the restructuring the largest out-of-court debt restructuring in corporate history, saying lawyers urged Chapter 11 but she expected hyperscaler deals on the other side. Interest expense fell by $500 million and net leverage dropped under 4x.
The pivot: Lumen is selling network-as-a-service and digital services over its fiber to connect AI data centres. It cites $13 billion of private connectivity fabric deals with hyperscalers such as Amazon, Google Cloud, Meta and Microsoft, digital services revenue of $117 million in 2025 targeted at $500-600 million by 2028, a refreshed board with five new directors since 2022, and a new chief revenue officer from Cisco.
Why it worked
The debt load from the fiber build-out left too little room to invest in growth.
Selling the copper-era local carrier and consumer fiber monetised assets without touching the enterprise network that hyperscalers need.
AI data-centre demand made the fiber scarce and valuable, which gave Johnson leverage to negotiate rather than file.
What can be applied
A distressed infrastructure owner can buy time by selling the slow assets and restructuring debt out of court, so long as it holds the one asset the new demand needs.
Aftermath
The turnaround is not finished: about half of revenue still comes from legacy voice, private line and copper services, with copper consumer revenue falling by low double digits a year. The company projects EBITDA growth to start in 2026, revenue growth by 2028 and a mid-30% adjusted EBITDA margin by 2030 (27.1% in 2025). The article notes analysts remain cautious, with two buy, ten hold and two underperform ratings.