- AT&T closed its deal to buy Lumen’s consumer fiber biz
- CEO John Stankey announced AT&T will bump its annual fiber build to 4M passings in 2026 and 5M passings in subsequent years
- Lumen can now pay off a chunk of its debt and fully focus on the AI and enterprise market
AT&T on Monday closed its $5.75 billion acquisition of Lumen’s Mass Markets fiber business, adding more than 1 million new fiber subscribers to AT&T’s total customer tally.
The deal, first announced in May 2025, will see AT&T expand its fiber footprint to 32 states, including more than 4 million new fiber passings in major cities such as Denver, Seattle and Salt Lake City.
Unsurprisingly, AT&T claims the acquisition will be key for growing its base of “high-value converged customer relationships.” The operator in January went ahead and aired a commercial stating both AT&T wireless and home internet are “now available across the nation,” which apparently was the first nationwide ad for AT&T fiber.
AT&T ups annual fiber build
With Lumen in the bag, AT&T already said it would double its multi-year fiber passings target from 30 million to 60 million by end of 2030. But it’s also ramping its annual build pace, AT&T CEO John Stankey revealed on last week’s Q4 2025 earnings call.
First, AT&T expects to increase its deployment pace from 3 million in 2025 to a run rate of 4 million by year-end 2026. After this year, the company intends to deploy fiber to about 5 million locations annually through the end of the decade, Stankey stated.
And he thinks there’s plenty of room to raise penetration in the Lumen footprint.
“We're acquiring a fiber network with only 25% customer penetration, well below AT&T fiber penetration of 40%. We estimate that fewer than 20% of these customers also subscribe to our wireless services,” Stankey said. “This is less than half of the convergence rate we've achieved in our current fiber footprint.”
Though AT&T talks a big talk about its convergence strategy, the company so far only markets fiber to “less than 15% of U.S. households," analyst Craig Moffett pointed out in a recent note to investors.
New Street Research analyst David Barden said in a note today closing the Lumen deal "only raises the stakes in the convergence conversation," especially now that Verizon finalized its Frontier acquisition.
Keep in mind, AT&T will use the acquired Lumen assets to launch another, Gigapower-style joint venture, dubbed “NetworkCo,” which will be partially owned by a private equity partner. Like Gigapower, NetworkCo will be an open access network.
What’s next for Lumen post-AT&T
For Lumen’s part, divesting its fiber-to-the-home business allows the company to sharpen its focus on AI and enterprise networking as well as pay off about $4.8 billion of its debt, Lumen said in a press release.
Naturally, Lumen will keep all of its national, regional, state, and metro level fiber backbone network infrastructure. The company deployed 17 million intercity fiber miles at the end of 2025 and as of October signed over $10 billion in Private Connectivity Fabric (PCF) deals.
Lumen is also retaining its copper-based footprint, which AT&T probably didn’t want anyway as it preps to fully retire copper services by the end of the decade. Stankey on last week’s call disclosed AT&T has now “stopped the sales of all targeted legacy copper-based services in 85% of our wire centers.”
Additionally, Lumen announced Wes Gibson, formerly EVP of Mass Markets, will head the NetworkCo JV.
Regarding the employees transitioning to AT&T, Lumen CEO Kate Johnson stated, “We’re grateful for their contributions to Lumen and confident they will continue to serve the consumer market as part of the AT&T family.”