By Harshita Mary Varghese
(Reuters) -Lumen Technologies topped Wall Street estimates for first-quarter revenue on Thursday, driven by strong demand for its connectivity solutions from enterprise customers amid a rapid growth in AI-intensive workloads.
The expansion of AI applications is driving enterprises to increasingly seek network infrastructure to manage the massive data flows and computational demands.
Last month, the company said it was partnering with Google to provide direct fiber access to Google cloud through Lumen’s metro-fiber.
“What we’re doing that is so fundamentally different is we’re cleaning up our network, and we’re moving to a place where that infrastructure will be very modern,” Chief Financial Officer Chris Stansbury told Reuters in an interview.
Last year, Lumen signed new contracts worth billions of dollars to provide networking and cybersecurity services to Big Tech companies.
The company has been working towards growing its digital fiber connectivity solutions while managing the challenges associated with its legacy business, which includes traditional telecom services such as voice, broadband and ethernet services.
Lumen said late last year that its consumer fiber business was a “great asset”, but “better suited in somebody’s hands that has a wireless offering.”
The fibre-optic cable provider reported revenue of $3.18 billion for the quarter ended March 31, above analysts’ estimate of $3.12 billion, according to data compiled by LSEG.
It posted an adjusted loss of 13 cents per share in the first quarter, compared with an expected loss of 27 cents.
Lumen reaffirmed its free cash flow and adjusted core profit estimates for the year.
“Things like tariffs at this point are not a huge impact to us this year and in terms of the broader economy, the reality is, most of what would impact us is actually in our control,” Stansbury said.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Shailesh Kuber)
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