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Bond Market News
Lumen Upgraded to B by Fitch
February 10, 2026
Lumen Technologies and its related entities (Level 3 Parent, Level 3 Financing and Qwest) were upgraded by two notches to B from CCC+ by Fitch. The upgrade comes after the company completed the $5.75bn sale of its Mass Markets fiber-to-the-home business to AT&T last week. The transaction is viewed as a major deleveraging milestone. Lumen used the proceeds to repay all super-priority debt, cutting leverage by roughly 1.5x from the mid-5x range to the high-3x range and repositioning the business toward enterprise customers. Its maturity profile also improved significantly, with no major debt maturities until 2029 following refinancing and debt repayments. Liquidity has strengthened further due to about $13bn in private connectivity fabric (PCF) contract wins, which include long-term dark-fiber and network service agreements with Microsoft and other hyperscalers and technology firms. Upfront payments from these contracts are being received over several years, supporting near-term cash flow. However, Lumen still faces structural challenges common to wireline telecom operators. The company is attempting to offset this through enterprise-focused investments and network monetization. Fitch believes the strategy could support future growth, though execution risk remains.
Its bonds traded stable with its 4.5% 2029s at 94.5 cents on the dollar, yielding 6.6%.
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