Greetings and welcome to Lumen Technologies First Quarter 2021 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded Wednesday, May 5, 2021. It is now my pleasure to turn the conference over to Mark Stoutenberg from Investor Relations. Please go ahead, sir.

Thank you, France. Good afternoon, everyone, and thank you for joining us for the Lumen Technologies first quarter 2021 earnings call. Joining me today on the call are Jeff Storey, President and Chief Executive Officer; and Neel Dev, Executive Vice President and Chief Financial Officer. Before we begin, I need to call your attention to our Safe Harbor statement on Slide 2 of our 1Q 2021 presentation, which notes that this conference call may include forward-looking statements subject to certain risks and uncertainties. All forward-looking statements should be considered in conjunction with the cautionary statements on Slide 2 and the risk factors in our SEC filings. We will be referring to certain non-GAAP financial measures, reconciled to the most comparable GAAP measures that can be found in our earnings press release. In addition, certain metrics discussed today exclude costs for special items as detailed in our earnings materials, all of which can be found on the Investor Relations section of the Lumen website. With that, I'll turn the call over to Jeff.

Hello, everyone, and thank you for joining today's call. I'm going to take a few minutes at the outset to share my perspective on the quarter and some of the key value drivers I see, not only in our business, but also with respect to our capital allocation and inorganic strategies. After that, I'll ask Neel to walk you through the details of the quarter and key drivers for the remainder of 2021 then we'll open it up to your questions. Before diving into our results for the quarter, I want to discuss a few points coming out of our Investor Day in April. I hope those of you who were able to join us, gained a better understanding of the markets, products and services, we believe, will drive our future growth as well as a sense of our conviction that we have the right assets, people, investment plans and execution strategies to grow both revenue and shareholder value over time. The path we reviewed during our Analyst Day is pretty straightforward. We are combining one of the world's best fiber infrastructures, our deep global interconnections to eyeball networks and our increasingly robust Lumen platform to build the infrastructure necessary to support a full range of fourth Industrial Revolution applications and use cases, including artificial intelligence, machine learning, augmented reality, IoT and unified communications. As of today, more than 85% of US enterprises are within five milliseconds latency of our edge cloud facilities. We are well on our way to reach our end of the year goal of 95% of US enterprise. Our fiber-enabled edge infrastructure, together with our embedded security capabilities and adaptive networking services, allows Lumen to deliver a differentiated solution set for expanding market opportunities. We're excited about the growing market for these services and our ability…

Thank you, Jeff, and good afternoon, everyone. Let me begin with our financial summary on Slide 4. For the first quarter of 2021, we delivered solid adjusted EBITDA and an expanded adjusted EBITDA margin on a sequential and a year-over-year basis. We also generated solid free cash flow. Based on our progress in the first quarter, we remain confident in our financial performance and are reiterating our outlook for the full year 2021. Turning to revenue on Slide 5. Total revenue in the first quarter declined 3.8% to $5.029 billion. Adjusting for the sale of a significant portion of our correctional facility 2020, our revenue would have declined 3.6%. Business revenue in the first quarter declined 3.8% to $3.595 billion or 3.5%, adjusting for the business sale that I just mentioned. Our overall Business segment revenue performance was impacted by lengthening sales cycles in the current environment that we mentioned during the last few earnings calls in our recent Analyst Day. Within our Business segment, iGAM revenue decreased 2.7% compared to roughly flat in the year ago quarter. In addition to lengthening sales cycles, our revenue performance this quarter was impacted by some CDN re-rates in a large customer disconnect. Large Enterprise declined 3% compared to a growth of 2. 3% in the year ago quarter. As Jeff mentioned, revenue performance was impacted by lower sales and completion of several projects in public sector. Within Compute & Application Services, we had a few COVID-related projects winding down. Sequential decline in Fiber Infrastructure Services category was a result of non-recurring revenue ramping down from completion of several network deployments without the corresponding benefit of similar revenues ramping up from new sales. Mid-Market and Enterprise declined 5.9% compared to 6.5% in the year ago quarter. The correctional facility business sale, I mentioned,…

[Operator Instructions] Our first question is from the line of Batya Levi with UBS. Please go ahead.

A couple of questions. Maybe first on trends that you're seeing in terms of lengthening the sales cycle. Has that been getting worse as we are looking at over the last few months? Any change recently that gives you the confidence that we could see some improvement in the second half? And maybe a question to Neel. There were a few one-time items that you highlighted. Could we get some numbers around that, maybe the nonrecurring benefits in the Wholesale segment or the contribution of the large customer disconnect in iGAM? And maybe a final question on the non-core assets, could you - the potential non-core asset sales, could you talk about what you would consider to be non-core? Thank you.

Thanks, Batya. Let me talk about sales cycles first. I don't know that they're lengthening any more than we've talked about over the last couple of quarters and during our Analyst Day back in April. We saw sales towards the end of the year lighter than we liked and sales at the beginning of the year lighter, but we had good sales in March. And so, we're starting to - we've got a good strong funnel. The market for our products and services are there. We're seeing better sales in March. I don't know if that's an overall change yet in the sales cycles, but things are starting to close again. And then with respect to non-core assets, I'll jump to the middle question and let Neel answer that. I don't want to get into specifics about different parts of our business and which ones that I'd call poor non-core. I think there's probably a pretty good sense of what those are. But if you look at where we invest, we're investing heavily in certain markets, in certain capabilities, in certain products, and those are the things that we think are core. So our fiber infrastructure, our edge computing, our platform that we're building, our customer experience, Quantum Fiber, all of those things, we think, are core to us and core to the products and services that we sell, and so we'll continue to focus our investments there. Neel?

On the question on some of the one-time items, in terms of iGAM, I called out a couple of things. One is we had some rerates for CDN. We typically see that for some of our large customers just to get the rights to market. And over time, we'll see volume growth. And we also had a large customer disconnect. It's a customer that we've had for seven-plus years. We just couldn't get to the right commercial terms going forward. Combination of those two things roughly was $15 million impact sequentially for iGAM. In terms of Large Enterprise, it was primarily public sector. There were some COVID-related projects winding down, like I mentioned. And also like Jeff referenced in his remarks and I mentioned as well, fiber infrastructure-related projects are completing. And those two things, in aggregate, was roughly a $40 million impact sequentially.

Our next question is from the line of Eric Luebchow with Wells Fargo. Please go ahead.

Great. Thanks. I appreciate you taking the question. Jeff, I just wanted to follow-up. I know you said that you would look at potential divestitures. You did have a strategic review in consumer - your consumer footprint recently. Just wondering if maybe you could comment on that as maybe an area you would at least look at? And related to that, is that business sufficiently separated from a network perspective from kind of your core enterprise business that you potentially could consummate such a deal in the relatively near-term opportunity that arise? And then my second question was on your client footprint, reaching fiber almost 30%. Maybe you could just talk about - where you're winning sharing in that footprint? Is it coming from more new accounts, or are there a lot of existing customers you're upgrading from legacy technologies and then you know any reasonable target in you're more mature fiber markets in terms of penetration? Thank you.

Sure. And I'll try and provide a little more color to Batya's question, but not too much. If you look at core and non-core, there is a - if you're looking at Denver and the network that we operate here in Denver, there's a strong tie between some of our commercial business and some of our mass market business. If you look in other markets, that's not as strong. So what we will look at with respect to the consumer copper network, that type of thing, would be looking at markets that we don't think are necessarily core to our platform in fiber strategy. I haven't - I don't want to be very specific about what those could be or might be. But I do want to emphasize that we're open to looking at divestitures, and we actively pursue them. Now I'm not ready to announce any deal because we don't have one. But I do want to reinforce that this isn't just CEO talk. It isn't just me saying, oh, yes, we're open to whatever. We sold the majority of our corrections business, and we've looked at other parts of the business, and we'll continue to do that and make sure that - that we're focused on the core of what's going to drive success for Lumen back to the fiber network, back to our platform capabilities, things like edge computing, dynamic connections. We've recognized with the change coming for our customers in the Fourth Industrial Revolution, those are the core assets that are going to drive our growth. And if it's not core to us, then we're open and opportunistic about considering other alternatives. Neel, would you take the second half?

Sure, Jeff. In terms of your question on Quantum Fiber, what we see is our micro-targeting approach is working. And from an aggregate level, I know we're 28% penetration. And that's because as we are driving up our penetration, we're also adding more units. But if we look at certain neighborhoods, certain markets where we've been there for a while and we track the penetration by aging of those deployments, in some markets, we're up in the 40%, 50% Zip code. So we clearly think there's a fair amount of opportunity to continue to drive the penetration up. So we'll continue with our focus on adding more fiber-to-the-home and small business and driving up those penetration rates.

Our next question is from the line of Simon Flannery with Morgan Stanley. Please go ahead.

Jeff, can you just talk about the buyback program and what the triggers would be? You talked about getting down to the leverage target. Do you need to get to the top end of the range to start the buyback programs, the 3-to-5? Or do you need to have that deal that gets you there? You could always start a program now even if you didn't necessarily use it. And then, Neel, you had a very impressive performance on the OpEx side. Particularly sequentially, we saw a big drop in things like SG&A. I know there was some kind of changing in your allocations. Perhaps you could talk through any of the cost saving items that were driving that. Thank you.

Thanks, Simon. And as I said in the kind of prepared remarks, we've made no decisions about whether we'll institute a buyback program or not. It's a topic of discussion for our Board, the size, duration, parameters, all of those types of things that triggers that you referenced, would be part of our discussion with our Board, and so we will continue to have those discussions. I don't have any specifics to share at this time. But our purpose in raising it with you today is to signal that we believe our shares are undervalued. And that, considering buyback is a potentially attractive capital allocation approach that we might take and want to be clear that it is something that we're considering.

And Simon, in terms of the OpEx savings, I would say, a big part of what you see in this quarter is the run rate, the full quarter benefit of the run rate savings that we achieved in the fourth quarter. So if you recall, we achieved the goals that we had for the transformation program, and so we see that benefit flowing through. And in addition to that, we had incremental savings that we achieved during the quarter as well. So that will be an ongoing thing for us. We will be focused on taking cost out of the business. And part of that, we're investing back in all the things that you heard us talk about in the Analyst Day, but the overall transformation program will continue for us.

Great. Any sense on the - how it flows through the rest of the year? Are there other big step functions in the cost savings? Or is it pretty linear from here?

Like always, we'll be very milestone-based about it. And so some of the things that we're doing from a customer experience perspective, you've heard a lot of our leaders talk about some of the automation initiatives. As we deploy those, we can take cost out of the organization. At the same time, it enables us to scale. So no, I think linear is probably a pretty good assumption. But overall, I would say, net of investing in the business and driving those savings, we feel pretty good about our full year EBITDA guidance of $8.4 billion to $8.6 billion.

Our next question is from the line of Frank Louthan with Raymond James. Please go ahead.

Great. Thank you. I want to go back on the potential divestitures. You said you do consider it positive for shareholders. Can you give us a little more color on how you see that? I mean, I think some of the issue in the past has been buyers pay a price, but there's a lot of overhead and so forth that doesn't necessarily go away. Now you've got CAF going away in some markets as well. Is there a materiality threshold of - for a sale price that makes it positive? I mean, I'm sure you could do a $10 million or $20 million deal with it may not be worth the time. Give us a thought on how you think about sort of the magnitude and that statement you made, Jeff, about considered if it's positive for shareholders? Thanks.

Yes. I won't give any comment on the magnitude, but I will tell you what positive looks like and what will trigger a decision is that we think it's in the interest of our shareholders to do that. Price certainly has something to do with that. Our ability to separate the business from Lumen has something to do with that. Our ability to capture and make sure that we don't have dis-synergies. I mean, there are all sorts of things that go into our valuation metrics that go on with that. And frankly, are we going to invest in it? If we're not going to invest in it, then it's obviously not something core to us. So we'll - all of those types of things go into the decision matrix for any deal that we'd do.

Okay. And just a quick follow-up. Do you have an idea of maybe how many customers or an impact you think you might be coming from the EVBP plan that's, I guess, going into place maybe starting next week?

No. I don't have any kind of customer count. I will tell you that just like we did with the Keep America Connected work with the FCC that we're working with them and we support the idea of helping our customers - our impacted customers during this difficult time. And so we'll continue to work with the FCC. Might have some update later in future quarters about what that really means for us. But right now, it's too early to say.

Our next question is from the line of James Ratcliffe with Evercore ISI. Please go ahead.

Thanks for taking the question. Understanding the potential for divestiture and view on the value of the business. So can you give us any color on why something substantive hasn't happened yet? Presumably, you've had these conversations. What have been the barriers? What have been the issues that have prevented the divestiture or sale of the business et cetera, to this point? Is it just price? Or are there other things going on? Thanks.

Neel, why don't you take a shot of that?

Sure. I think one of the key things that Jeff highlighted is that we're being very disciplined about it because we want to make sure that it's accretive to our shareholders, that it really creates value for our shareholders. With all the deleveraging that we've done and the strengthening of the balance sheet that we've done, we don't really have to do anything as such, but we think there are things that we could do that enhance our shareholder value. And so we're not hardy to get something done just for the sake of getting something done. It really is about doing something that creates more shareholder value. And that's why it's not a time line-driven initiative that we have to delever or we have to do this, it really is about creating more shareholder value.

And we spent the last couple of years, working on improving the fundamentals of our business, those things that - even if we don't think they're core long term, we've improved our customer experience, we've reduced churn, we've stabilized things across, the operating costs and we'll continue to do those things. If you look at the mass market business, as an example, on the consumer side, we grew something like 40,000 broadband, high-speed broadband ads over the last quarter. And so we've been making investments to - in different parts of our business to improve them up until this point.

Our next question is from the line of Nick Del Deo with MoffettNathanson. Please go ahead.

First, are you confident that you can accelerate revenue growth without having to back pedal on the profitability and return metrics that you've enforced for the business since the deal closed? Has the market moved at all such that those metrics may need to be adjusted? Or is that not something you're saying?

Nick, so one of the things that you don't see in our revenue line but you hopefully see that in our profitability metrics, is our focus on that and our focus on profitable revenues. So, if you think about our business, every month, you have churn, and you're replacing that with newer services. And we focus on profitable revenues. And so as we've managed the business over the last couple of years, the revenues become more durable, more profitable. And if you think back to all the plans that we shared at the Analyst Day, fiber is foundational to all of that. And so being on that is a big part of our value proposition. And so we don't think we have to sacrifice profitability. In fact, we think our approach, it's a better customer experience when we have the customer on that. And all of the higher layer services really leverages our infrastructure. And it is a better experience for the customer when there is automation there is self-service, which drives a very different margin profile. We're seeing that in the consumer space, and we're seeing that in the enterprise space. So yeah, we don't need to - we don't think we need to make that trade-off. Now in terms of investing, to get some of these things going, in terms of sales and marketing, some of the investments we're making with our partnerships, the ecosystems, brand, et cetera, we're leaning in and making those investments. But over time, the underlying product profitability, we don't think - we don't have to make any trade-offs there.

And then maybe one bigger picture question on revenue. As I think back over the last several years, you've made some very - as you know, it's some very substantial and positive changes to the business. I think sales force, customer service, new products, those should have all helped the revenue trajectory. If we set aside this quarter's results specifically and instead of thinking about the multiyear growth trajectory you've had, how does that compare to your expectations from years past? And what do you think the primary variances have been attributable to?

So I would point you towards some of the categories that we've laid out for our reporting in terms of our expectation. Now we're not where we need to be. And part of that is the environment that we're in and some of the delayed decision-making and sales cycle lengthening that we've highlighted, but Jeff mentioned, we had a good sales month in March. But going forward, I think, if you look at our reporting, - that will manage for cash. On the Enterprise channels, voice and other will continue to decline, and we'll manage that for cash. But as we look at the areas that we're investing, whether it's compute and application services, IP and data services and our fiber infrastructure services, we expect to improve - continue to improve our revenue trajectory. Just to give you an example on like IP and data services, right now, we're seeing churn, which is pretty much in line with our historical averages, but we're not selling a lot of large new networks, but we expect that to change as we look forward. So those would be the categories that we'd expect to see improvement.

Our next question is from Brett Feldman with Goldman Sachs. Please go ahead.

Yes. Thanks for taking the question. And - you noted during your remarks earlier that in the areas where you're making significant investments, you are seeing good growth. And while we can see that there are pockets of growth across portions of your business based on your reporting, in aggregate, most of your revenue streams are still experiencing a degree of pressure. So it certainly would suggest that there are areas where you could see a positive response to stepped up investment. So with that as sort of context, I guess I'm intrigued that buybacks are now sort of under evaluation. As the Board looks at the opportunity to potentially start repurchasing shares, what are the alternatives that you're going to be comparing against? What are the criteria to make additional direct investment in the business, whether it's a CapEx or the sales force or a product or maybe even going out and pursuing acquisitions that might be complementary to the business versus the returns that you might get from purchasing your shares? Thank you.

Sure. And I think you answered your own question a little bit. And those are the alternatives. Can we invest in the business? Are there parts of the business we want to invest in more heavily? We have not yet started growing our edge computing to the level that we want. Now that's not unexpected because it's a brand-new product set in a brand new market. So we're very focused on it and pleased with the reception in the market, but we think it can be great big. And so if we think it can be big, we would obviously continue to invest in that if we get the market traction. Neel mentioned in his comments that we tend to be success-based in our capital investments. And so we'll make sure that we can continue to accelerate growth by investing in those and I'll point to mass markets for Quantum Fiber. We set out a couple of years ago, we were investing heavily in bonding and vectoring and upgrading the copper plant. We've stopped all of that. We invest in fiber. We are focused on fiber for that business. So opportunities to increase there are also things that it would be on the table, investing in our sales force, all of the things that you mentioned to drive revenue because we are very focused on driving revenue, improving the revenue trajectory and driving that performance going forward.

Yes, the one thing I would add, Brett, is that if you look at the midpoint of our free cash flow, we're at $2.9 billion, our dividend of $1.1 billion, that leaves us $1.8 billion of discretionary free cash flow, right? So there is a question of, obviously, allocation and timing and sequencing. And so those are all going to be parts of the discussion that we continue to have with the Board.

Our next question is from the line of Michael Rollins with Citi. Please go ahead.

Thanks and good afternoon. A couple of follow-ups and then just a larger question. So first, you mentioned some of the headwinds. You quantified some of the headwinds in an earlier question in IGAM and I think relating to the public sector. I was just curious if you could share the size of the revenue benefits. You also disclosed on the settlement payments that you referenced in the initial commentary. Second, just curious if there's any currency impact sequentially or year-over-year that we should be mindful of? And then just a larger question. You mentioned in a market like Denver, you see synergy between the commercial and the mass market side. And I'm curious if you take the top 10 vendors, your top 10 markets where you see that synergy between commercial and Mass Market, what does that look like in terms of the number of homes or population that you're serving and how upgraded those networks are from the context of fiber and the Quantum product? Thanks.

So I'll start with the easy one. Currency was not a factor either sequentially or year-over-year. In terms of wholesale, you'll notice the business was roughly flat sequentially. And like I mentioned, there was a benefit from some carrier settlements, which are roughly about $15 million. And in mid markets, we had a couple of - you have to keep in mind a couple of things going on. One is, as you look at mid-market year-over-year, we did have the sale of the correctional facility business or a significant portion of that in third quarter of last year. And if you look back to fourth quarter last year, that was roughly $15 million or so. And that was offset during the quarter when we did have some good wins in the mid-market segment and there are some one-time revenue related to that, which included equipment and pro services. So if you look at the percentage change year-over-year, you don't really have to normalize for that if you're normalizing for nonrecurring revenues. In terms of your question on top 10 markets, I can take a shot at that. Or Jeff, do you want to?

Yes, I'll try and then you can fill in the blanks. I don't have any numbers to quantify the questions you have about what our top 10 markets, how many homes there are, how many fiber homes, any of that. But let me tell you about the strategy in those top markets. And that is when we build fiber down the street to go to a residential home. We also pass small business customers. We've pass mid-market customers. We pass enterprise buildings. We pass wholesale locations and government locations. And so, we know that as we build infrastructure in those top markets, there's a lot of synergy that comes from the network that we build and the people that we use to operate it in the way that we deploy it. And that's not going to be true, and I'm always hesitant to pick markets by name. I think Denver because that's where I'm sitting today. But if you look at some rural small town, we don't have those same opportunities. And so they're not going to be as attractive to invest in. In addition, we follow a - when it comes to the consumer business, a very diligent micro-targeting strategy, where we look at the cost to build, we look at the densities, the average penetration rate, what we think we can accomplish in the market, the needs for the services, and we use those types of levers or triggers to identify where we want to build and where we don't want to build. Those typically are pretty good in our dense urban clusters like at Denver. Neel, I don't know if you want to add.

I don't really have anything to add.

Okay. Thanks Mike.

Our next question is from the line of Phil Cusick with JPMorgan. Please go ahead.

Thank you. First, we've talked about activity and sales ramping in the second half. Do you think that, that means that revenue can ramp in the second half as well? Or do the sort of typical sales cycles mean that we're really looking at an improvement in 2022? And then second, Jeff, I apologize for coming back to the selling of non-core assets, but it seems like it's something that we've been through before. Is this a new effort or a continuation of the strategic review that you went through a couple of years ago? And since then, has there been any change in your view of what assets you would be willing to sell or what appropriate structures might be? Thank you.

So let me take the second one first. It's not a new initiative. I've been saying for the last couple of years that we are working on - looking at how we maximize shareholder value for - with the assets that we have. Does our opinion change over time? Potentially, depending on what the market price is for those assets and how well we're performing with them. So yes, our - the calculations can change over time, but this isn't something new. The thing that I'm trying to address here is I get comments from time to time that say, yes, everybody says that. I'm sure everybody does say that. I just want you to know that we are serious about it and that we are looking and continue to look at non-core assets and we'll continue to focus on how do we look at all of our assets and generate the best shareholder return with all those assets. Neel, do you want to take the first part?

Phil, on our commentary on the second half, I would say we're fairly optimistic, but there is also a fair amount of execution in front of us. Like Jeff mentioned, we had good sales month in March. If you think about typical time lines for us in terms of sales to installs and turning into actual revenue, we need very good sales in the second quarter. So we need to execute on sales in the second quarter. We need to execute on driving up usage on a lot of our usage-based products and services. We are leaning into a lot of new initiatives that you heard us talk about. Those are emerging opportunities, and we need to see market traction on those initiatives. We have also - you've seen a number of announcements from us in terms of our partner ecoship systems. We're very optimistic about those partnerships. We're working well with the partners there. We're going to market together. And we'll need to see good traction on those partnership ecosystems. So, yes, it's all about execution. And if we do execute, then we expect to see not only just sales order ramp, but also revenue improvement.

Thanks, guys. Jeff, if I can follow-up. There's a ton of interest in fiber-to-the-home, and I apologize, I keep coming back to this theme. But would you consider taking direct investment in an acceleration in that business?

If we thought that it was in our shareholders' interest, absolutely.

Thanks, Phil. France, we've got time for one last question.

Our last question then will be from the line of David Barden with Bank of America. Please go ahead.

Thanks so much for squeezing me in. I guess, Jeff, I wanted to ask you about, kind of, the competitive landscape, starting with Verizon's, kind of, renewed interest in the business segment as a platform for selling their 5G network and obviously, AT&T being the market leader in that. You recently announced a partnership with T-Mobile. Is the landscape changing in a way that kind of necessitates a mobile product at this stage? Or is that more of a prophylactic measure just in case? And then, the second question, Neel, could you remind us, in the context of this stock buyback conversation, what the leverage target is? When you want to achieve it? And have you floated this by the rating agencies? And what have they said? Thanks, guys.

With respect to T-Mobile and 5G, we're really excited about the T-Mobile relationship that we have. We think that there's a great opportunity to marry their 5G network with our fiber network and take the - deliver the advantages of both to our mutual customers. And so, we're super excited about it, especially as it relates to edge computing. And we'll continue to invest in that. I don't have specific use cases, but things like automated manufacturing, robotics, all of those types of things, we'll really be able to leverage. I think we'll be able to leverage the 5G network of T-Mobile with the fiber network of Lumen. Now, I always believe that wireless means exactly what the word says, just a little less wire, and that communications wants to get to fiber optic very quickly, and that's where the strength of the Lumen network is, is in the fiber backbone that we have, the fiber connectivity, the deep peering interconnections, all of those types of capabilities. And I think they're very competitively placed in the market. Yes.

David, in terms of your question on leverage target, like Jeff mentioned, we haven't changed the target. The target is 2.75 to 3.25. But the key point is, from a time line standpoint, we don't see a real urgency to get there right away. We'll get there over time because that is just one data point. You have to look at holistically where we stand and some of the outcomes that we've achieved in terms of our interest cost savings. The coverage ratios that we have, our access to markets, our maturity profile, et cetera. So overall, we are very comfortable with getting there over time. In terms of the rating agencies, we're in constant conversations with them. We provide them regular updates in terms of our business. And like Jeff mentioned, we don't have anything specific yet to share with them. And when we do, we'll obviously have that discussion.

Okay. All right. Thanks for joining us today. I appreciate everybody taking the time. I guess I'll summarize with a couple of thoughts. First of all, we're focused on revenue, profitable revenue. We never talk about anything but profitable revenue and free cash flow. So we continue to stay focused as a company on the free cash flow that we generate, but driving that through profitable revenue growth. We're excited about the capabilities that we talked to you about a few weeks ago at the Analyst Day. We think we are bringing the products and services and the capabilities over the Lumen platform that the market needs and that the Fourth Industrial Revolution demands. And so we're really excited about our partnerships like the one that you asked about with T-Mobile, because we think that helps us and augment our capabilities to deliver that, and we're starting to see success with some of those partnerships. We continue to invest in growth. We aren't skimping on capital. We are focused on growing our business, where we think the market will go. We're focused on continuing to augment what we believe is one of the world's most powerful fiber networks. And we'll continue to do that both on the mass market side and on the enterprise side. Now we also think that our shares are undervalued, and that brings up the questions for our Board about what's the best capital allocation approach. And so we wanted to mention that to you that we are having those discussions with the Board. And then lastly, we are we got a lot of questions on this, but we are serious about looking at the best way to maximize all of our assets for our shareholders. Some of those that are core invest heavily in and then those that are non-core look if there are opportunities to divest them or take cash out of them. We will look at what we think is the strategy for each of those types of assets for maximizing value.

With that, I'll wrap the call. Thank you for your attendance today. Thank you for your interest in Lumen. We appreciate it.

Thank you. We would like to thank everyone for your participation and for using the Lumen conferencing service today. This does conclude the conference call. We ask that you please disconnect your lines. Have a great day, everyone.