Lumen Technologies, Inc.

Credit and liquidity · Debt service and covenant compliance

Restrictive covenants and potential defaults under our debt agreements could materially affect our operations and liquidity. Under our consolidated debt and financing arrangements, the issuer of the debt is subject to various covenants and restrictions, with the most restrictive applying to Lumen Technologies, Inc. and Level 3 Financing, Inc. We cannot assure you that we will be able to comply with these covenants. Failure to do so may result in an event of default, which could lead to the acceleration of substantial indebtedness, severely constrain our liquidity, and potentially force us to seek bankruptcy protection.

Market and investment · Interest rate and yield curve risk

We face other financial risks, including among others the risk that higher prevailing interest rates would increase interest expense under our floating-rate debt.

Market and investment · Asset valuation and impairment

We face other financial risks, including among others the risk that future intangible asset impairments could result in significant non-cash charges, reducing earnings and stockholders' (deficit) equity and adversely affecting our financial condition.

Capital structure and performance · Credit rating and cost of capital

These risks could be exacerbated by changes in economic conditions, additional borrowings, or credit rating downgrades. Subject to certain limitations, our existing debt agreements permit us and our subsidiaries to incur additional indebtedness.

International and currency · International operations and emerging markets

International operations expose us to regulatory, economic, and political risks. Our international operations are subject to a wide range of U.S. and non-U.S. laws, regulations, treaties, tariffs, and governing our operations in international jurisdictions. Many of these laws or directives are complex, frequently change, and may conflict across jurisdictions in which we provide services.

Market and investment · Investment portfolio performance

Funding obligations for employee benefit plans could negatively impact profitability. Our company-sponsored benefit plans cover current and former U.S.-based employees. The cost to fund these pension and healthcare benefit plans for our active and retired employees has a significant impact on our profitability. Our costs of maintaining these plans, and the future funding requirements, are affected by several factors, including investment returns on funds held by our applicable plan trusts.

Reputation and brand · Esg environmental social governance performance

Our environmental, social, and governance programs and disclosures may expose us to legal, operational, and reputational risks. We are subject to evolving and sometimes conflicting, laws, regulations, policies, and investor and other stakeholder expectations concerning environmental, social, and governance matters, such as environmental sustainability and climate change.

Reputation and brand · Brand damage and negative publicity

Our Lumen and other brand names, together with our corporate reputation, are critical assets that support our ability to attract and retain customers and employees. These assets are vulnerable to significant harm from events such as customer or competitor disputes, cyber-attacks, service outages, data breaches, internal control deficiencies, performance failures, compliance violations, employee misconduct, government investigations, or litigation.

Reputation and brand · Social media and digital reputation

Our reputation may further be impaired by criticism from customers, vendors, employees, advocacy groups, regulators, investors, the media, social media influencers, or others regarding our services, operations, or public positions. The risk of reputational harm associated with unauthorized disclosure of confidential information or customer data may increase if employees misuse social networking platforms or emerging technologies, including generative AI tools.

Strategic execution · Merger acquisition and divestiture risks

We may not realize the anticipated benefits of prior completed divestitures, including the 2026 sale of our Mass Markets Fiber-to-the-Home business and our 2023 EMEA divestiture. On May 21, 2025, we and certain of our affiliates agreed to sell our Mass Markets Fiber-to-the-Home business in the Territory. In connection with divesting our EMEA business in 2023, we completed internal restructurings and entered into multi-year agreements with the purchasers to provide certain transitional services.

Innovation and product development · Product development and randd investment risks

We have prioritized sales from our PCF solutions in recent periods. PCF agreements involve delivery obligations and performance conditions that can affect timing and amounts of revenue recognition. Construction delays or cost overruns — from weather, supply chain, labor, permitting or other issues — could raise costs.

Innovation and product development · Intellectual property protection and infringement

We may not be successful in protecting and enforcing our intellectual property rights. We rely on patents, copyrights, trade names, trademarks, service marks, trade secrets, and other intellectual property rights, as well as confidentiality agreements and procedures, to safeguard our proprietary assets. However, these protections may not be fully effective, including due to legal limitations and enforcement challenges.

Customer and revenue · Revenue concentration in specific products or segments

Primarily due to competitive and technological changes discussed throughout this report, we have experienced prolonged systemic declines in several of our legacy services, including local voice, long-distance voice, network access, and private line revenues. More recently, pricing pressure and other factors have contributed to revenue declines across a broader array of products and services.

Geopolitical and trade · Trade policies tariffs and sanctions

In addition, increases in U.S. tariffs could result in additional costs that we may not recover from customers. Changes in government trade policies could adversely affect our business. Changes in U.S. or foreign government policies may result in modifications to existing trade agreements, the imposition of new tariffs, or significant increases in existing tariffs on goods imported into the U.S.

Natural and catastrophic events · Natural disasters and extreme weather

Extreme weather and climate change could disrupt operations and increase costs. Many of our domestic facilities are located in regions susceptible to severe weather and natural disasters, including tropical storms, hurricanes, tornadoes, earthquakes, floods, wildfires, or other casualty events. These events have disrupted operations in the past and may occur again, potentially causing significant damage such as downed transmission lines, flooded facilities, power outages, fuel shortages, network delays or failures, property and equipment loss, and business interruptions.

Geopolitical and trade · Regulatory and policy uncertainty

Laws governing our operations have long been unsettled, limiting our ability to plan effectively. Regulatory uncertainty has increased following a 2024 U.S. Supreme Court decision eliminating judicial deference to agency interpretations of ambiguous federal laws. Future legislation or court rulings could impose burdensome requirements or liabilities.

Cybersecurity and data protection · Insider threats and access controls

The risk of reputational harm associated with unauthorized disclosure of confidential information or customer data may increase if employees misuse social networking platforms or emerging technologies, including generative AI tools.

Cybersecurity and data protection · Third party data security and vendors

We rely on a limited number of suppliers and vendors for critical equipment and services, including fiber optic cable, software, optronics, transmission electronics, digital switches, routing equipment, customer premise equipment and components. Our business could be adversely affected if these parties fail to deliver products or services on acceptable terms due to operational disruptions, increased pricing, security incidents, litigation, financial distress, bankruptcy, or strategic changes.

Digital transformation and innovation · Digital transformation and modernization

To achieve our operational and strategic goals and projected cost savings, we must integrate and modernize legacy systems, retire aging or obsolete platforms, deploy master data management, and complete our digital transformation to deliver a global digital platform with automated offerings and digital self-service. We cannot assure you these efforts will be completed on time, be within budget, or achieve intended benefits.

Data and privacy · Data protection and privacy laws

We are subject to numerous data privacy and security laws, including recently enacted or strengthened requirements in the EU and certain U.S. states. These laws are complex, frequently change, and often conflict across jurisdictions. Customers may impose additional requirements. Noncompliance could result in substantial penalties and reputational damage.