Lumen Technologies (LUMN) stock is experiencing a pre-market plunge of 5.17% on Friday, as investors continue to react to the company's underwhelming second-quarter financial results released after market close on Thursday. The telecommunications firm's performance fell short of expectations in key areas, overshadowing some positive aspects of the report.

The primary driver of the stock's decline appears to be Lumen's Q2 adjusted EBITDA, which came in at $725 million, substantially below the analyst consensus estimate of $834.9 million. This significant miss raised concerns about the company's profitability and operational efficiency. Additionally, Lumen reported revenue of $3.09 billion, slightly missing the $3.11 billion expected by analysts and down from $3.27 billion a year earlier. The company also posted an adjusted free cash flow of -$209 million for the quarter, indicating that it spent more cash than it generated from its core business operations.

Despite these disappointing figures, there were some bright spots in Lumen's report. The company posted an adjusted loss of $0.03 per share, significantly better than analysts' expectations of a $0.25 per share loss. Furthermore, Lumen raised its full-year 2025 Free Cash Flow guidance to $1.2 billion to $1.4 billion, up from the previous range of $700 million to $900 million. The company is also making progress on its transformation strategy, including an agreement to sell its consumer fiber business to AT&T for $5.75 billion and efforts to strengthen its balance sheet through debt refinancing. As Lumen continues to position itself for AI-related opportunities in connectivity, investors will be closely watching to see if these strategic moves can help reverse the company's recent stock performance.