Key Points
Lumen Technologies is prioritizing a transition to enterprise fiber and AI-driven networking following significant asset divestitures.
Viasat maintains a strong foothold in government and aviation connectivity through its global satellite fleet.
Which of these communication infrastructure players is the better addition for your 2026 portfolio?
The digital world depends on physical infrastructure, whether it is fiber cables in the ground or satellites in orbit. Lumen Technologies (NYSE:LUMN) and Viasat Inc (NASDAQ:VSAT) are both undergoing major transformations to meet this demand.
Lumen is pivoting toward high-bandwidth fiber and artificial intelligence infrastructure for businesses, while Viasat provides critical satellite-based connectivity to remote locations and moving vehicles. These companies represent two distinct ways to invest in global communication stocks landscape. This comparison examines their current financials and risk profiles to determine which best fits your portfolio.
The case for Lumen Technologies
Lumen Technologies operates as a global communications provider focusing on edge cloud, cybersecurity, and networking solutions for enterprise and public sector clients. Following the February 2026 divestiture of its Mass Markets Fiber-to-the-Home business to AT&T (NYSE:T), the company has shifted its focus away from residential consumers. Its current strategy relies heavily on its unified digital platform and the integration of cloud-native networking from its acquisition of Alkira.
In FY 2025, revenue was $12.4 billion, reflecting a year-over-year decline of approximately 5%. The company reported a net loss of nearly $1.7 billion, much wider than its 2024 loss. This shows pressure as the business transitions away from legacy services and builds out its newer fiber-based offerings.
Lumen has $13.25 billion in debt and $1.6 billion in cash on hand, meaning its total liabilities could be a burden on shares. Free cash flow, which is the cash remaining after a company funds its operations and capital investments, reached nearly $1.4 billion for the year.
The case for Viasat
Viasat provides satellite-based connectivity services to the aviation, maritime, and energy markets across more than 70 countries. Its primary customer is the U.S. government, which accounted for approximately 16% of fiscal year 2026 revenue. Customer concentration like this adds a layer of risk to the business. The company is currently focused on expanding its in-flight services, which already support nearly 4,580 aircraft, and growing its presence with the U.S. Space Force.
For FY 2026, which ended May, revenue reached roughly $4.6 billion, representing growth of approximately 3% over the previous year. It reported a net loss of approximately $34 million. While still reporting a loss, the narrower loss compared to previous years suggests progress in managing its heavy satellite deployment costs.
Viasat had a debt-to-equity ratio of 1.5x as of March 2026, which compares its total debt to its shareholders’ equity. During the fiscal year, the company generated approximately $597 million in free cash flow, representing the cash left over after accounting for necessary capital expenditures.
Risk profile comparison
Lumen faces significant debt challenges that require ongoing restructuring, limiting its ability to invest in growth. The company is also experiencing a systemic decline in legacy voice and data revenue, making its transition to modern fiber services critical. Furthermore, its role as a network provider exposes it to sophisticated cybersecurity threats and potential service disruptions that could harm its long-term reputation.
Viasat relies heavily on contracts with the U.S. government, meaning any policy changes or budget cuts could impact its revenue. Operating in space also brings physical risks, as satellite malfunctions or collisions are possible and might not be fully covered by insurance. Additionally, the company manages nearly $7 billion in debt and faces intense competition from well-capitalized rivals such as Amazon.com Inc (NASDAQ:AMZN).
Valuation comparison
Lumen appears cheaper based on its P/S ratio, which compares stock price to revenue. Both companies lack a Forward P/E, which measures price against future earnings estimates.
| Metric | Lumen Technologies | Viasat | Sector Benchmark |
|---|---|---|---|
| Forward P/E | n/a | n/a | 16.6x |
| P/S ratio | 0.5x | 2x | n/a |
Sector benchmark uses the SPDR XLC sector ETF.
Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.
Which stock would I buy in 2026?
It’s been tough sledding for Lumen. First-quarter fiscal 2026 revenue declined 5% after excluding the residential fiber network sale to AT&T. Business segment revenue declined 3%, continuing a recent trend. The firm generated $380 million of free cash flow during the quarter, but announced no new fiber infrastructure agreements. Fiber deals come in bunches, so not having one in the first quarter isn’t necessarily terrible, but combined with the sharp declines in its traditional business lines, it suggests caution is warranted.
There is hope, however, thanks to the Alkira acquisition. A huge amount of enterprise data today is transferred over the public Internet, which means more network hops, which are slower and less secure than the private worldwide market Lumen can now offer. If the business can find enterprises that value security and privacy, that will provide a real source of growth.
Viasat, meanwhile, closed out its fiscal 2026 with strong free cash flow even as it invested heavily in long-term projects. That includes developing and deploying shared, multi-tenant, multi-orbit L- and S-band infrastructure. That will allow Viasat to offer global flight and maritime safety, enable next-generation air, ground, and maritime vehicle autonomy, and offer mobile direct-to-device opportunities, with a focus on lowering capital intensity. The business aims to offer those services in 2029.
Closer in Viasat is expected to post fiscal 2026 sales of about $4.9 billion, up about 5%, though with a wider net loss of $225 million or so due to capital investments.
Both businesses are positioning themselves for a brighter future. However, Viasat seems to be in tune with trends toward more data services being handled by satellite, while Lumen is still aiming to hit on a terrestrial data network business model that works. For investors looking for the better buy in 2026, Viasat is the choice.
Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.