What Happened?
Shares of telecommunications infrastructure company Lumen Technologies (NYSE: LUMN) jumped 4.3% in the afternoon session after the company announced a strategic partnership with Digital Realty to deliver high-capacity connectivity services designed for artificial intelligence (AI) applications. The collaboration was set to make Lumen's new Wavelength RapidRoutes services available on Digital Realty's global data center platform. This partnership aimed to empower organizations with connectivity speeds up to 400G, allowing them to rapidly build and use AI applications. The move aligned with the company's recent strategic pivot towards AI infrastructure, which was highlighted during its Q2 2025 earnings call. In that same report, Lumen also noted it had raised its free cash flow guidance for 2025.
Is now the time to buy Lumen? Access our full analysis report here.
What Is The Market Telling Us
Lumen’s shares are extremely volatile and have had 50 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock dropped 2.8% on the news that President Donald Trump threatened to significantly increase tariffs on Chinese imports, reigniting trade war fears. The threat immediately broke a monthslong calm on Wall Street, sending the S&P 500 down 1.2% in its worst session since August. For the industrial sector, which is heavily reliant on global supply chains, the prospect of new tariffs is particularly concerning. Aggressive U.S. trade policies lead to unpredictable input costs and disrupt manufacturing operations. This volatility weighs heavily on companies that depend on a stable international trade for both sourcing materials and selling finished goods, leading to a broad sell-off among industrial giants.
Lumen is up 29.9% since the beginning of the year, but at $7.29 per share, it is still trading 28% below its 52-week high of $10.12 from November 2024. Investors who bought $1,000 worth of Lumen’s shares 5 years ago would now be looking at an investment worth $734.13.
Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.
