Lumen Technologies Inc. LUMN -15.64% shares went through the roof after the phone company said it had signed five billion dollars worth of new deals. The stock also seems to be being driven by a lot of other good news.
The company said in a statement on Monday that the growth in its order book of $5 billion was due to a rise in demand for products that use artificial intelligence.
CEO Kate Johnson said, “The AI economy is changing how businesses work, and they’re realising they need strong network infrastructure to handle the huge amounts of data coming in now and in the future.”
It offers safe fibre connections that it says are “AI ready.” The company recently made deals with tech giant Microsoft MSFT -3.27% so that Microsoft can use Lumen’s network equipment in its data centres.
The second good news is that the phone company said it is “actively discussing” with customers how to get an extra $7 billion in sales. Lumen said that over the next five years, it will more than double the number of miles of networks it has between cities because of the high demand.
Investors will be hoping that management will raise guidance when it reports second-quarter results after the market closes on Tuesday. This is because demand for the company has grown a lot.
Before the market opened, Lumen stock was up about 45%. The stock has gone up a huge 144% in the last month.
Another sign that companies that build the tools that AI needs are doing well, even though the market is questioning why some big tech companies are spending so much on AI.
