00:00 Speaker a
Lumen Technologies sells its consumer fiber for home business up to AT&T for five points of $ 75 billion in cash. This is part of the company’s efforts to focus on your company’s strategy. To learn more about it, we joined Lumen CEO Kate Johnson, who joined us, and joined me to Morning Trump host Brad Smith. Kate, thank you very much for taking the time to talk to us this morning. So, when selling this business to focus on your business business, talk to me through thinking about it and how it will allow you to do it.
00:55 Kate Johnson
UH, thanks for taking me to the show and happy to announce that this is a Lumen new day. The thinking of the agreement was quite simple. Hm, every company on Earth is based on AI. It has become a mission of critical technology for any business that wants to reorganize, to innovate, to compete and perform in this environment. Hm, and we have the right to win the property to support the companies I can talk about more about a minute. I think there was another trend we look at very carefully, that is, the rapprochement of the demand for fiber and wireless connection in the consumer space. AT&T has a scale, a brand, a trace to actually compete and invest in that business. So we decided to double the right where we have the right to win and sell the business on the AT&T users’ fiber side and, UH, and keep our ability to truly serve the company.
02:22 Brad Smith
You know, I am amazed by the negotiations you have led with AT&T executives, I had the opportunity to talk to CFO Pascal Desroches in the past, and in recent weeks, when I have discussed their fiber plans, where it finally appeared and it turned out to be meaningful, not just AT&T, but Lumen, but Lumen. Lumen, not just Lumen.
03:06 Kate Johnson
Well, I mean if you look at the transaction, uh, brad, it really is perfect for us. $ 5.75 billion when you make net income after tax and add some cash, we can, we can reduce the debt of $ 4.8 billion and run the company from $ 4.9 to 3.9, and it’s just starting out. We keep all assets on the copper side of the consumer, wholesale and corporate space. They have meaningful, cash flows and contribute significantly to our overall financial health. So we can continue to use those dollars to do everything we want. We now have financial flexibility. We can pay the debt. We can continue to digitize and simplify our activities, or we could start thinking about the purchase of new opportunities for the company.
04:25 Speaker a
Hm, Kate, talk to us a little about your company’s customers if you can tell us who they are or who they are, and what the growth option looks like.
04:46 Kate Johnson
Of course. A big company from commercial side, UH, you know, the medium market, we serve the public sector, everyone, okay, okay? All of them are also in North America, international corporations. And our network is close to so many of them because it is huge and is close to them. They all have a common problem. Ai is about the huge data processing needs, right? And there is a lot of complexity, today, network architecture. You have a On-Prem, you have an advantage, you have data centers, you have a few clouds and you have to provide data to the most effective place for calculation, which means you need a network that can support it. And Legacy Networks, they are not large enough, not fast enough, not safe enough and are not smart enough. So we set it all with our physical network and digital layer to the top to make it easy for any company, public sector or commercial, large or small – to use the net to use AI.
06:33 Brad Smith
Given all of this, given the income of such an agreement as you see how the future of the business accumulates a business that investors have actually tried to wrap their thoughts over the last couple of years, as confirmed by some stock prices and knowing how much capital should be in advance.
07:08 Kate Johnson
We already have a digital platform where we provide a network as a service to these customers. This is cloudy with Telco, so take traditional transport mechanisms, whether IP, waves or Ethernet. And now Imagine to give customers the opportunity to shoot any port at any time and anywhere and anywhere. This is the use of clouds. This is how they are used to thinking about these opportunities, and we give them it now. However, we also invest in data protection and security services that we can put on that digital experience. So we have this wonderful ability to expand the services for sale to increase revenue in the company’s space and to give it a cloud economy, which means that the threshold costs continue to serve these customers. We are just starting out that this is the new future of network development, but we have made incredible progress and the future is extremely bright.
08:40 Brad Smith
How many of these networks do you think will continue to remain on the ground and some of these cloud data centers compared to what is sent through the satellites to the sky, as we see that the other side of the relationship is also preferred?
09:07 Kate Johnson
So I think any company must have a great strategy related to how they intend to transmit data. If they have remote areas, you know, you can move from fixed wireless connection to a satellite to 5g. And when they think about transportation, you know, data, data must be found as soon as possible. So we really like our role, no matter what technology and how it develops, the data must find the fiber as soon as possible, and we have the best fiber network.
10:02 Speaker a
Kate, thanks again so much for taking time. Bradai, thank you and you.