Cogent Communications (CCOI) Q2 2026 earnings summary

Executive summary

• Service revenue for Q2 2026 was $235.6 million, down 1.5% sequentially and 4.3% year-over-year, with net income rebounding to $66.6 million from a prior net loss, driven by a $130.7 million gain on the sale of ten data centers.

• The company operates a global IP network serving corporate, netcentric, and enterprise customers in 308 markets across 58 countries, and continues to integrate acquired Sprint and Cogent Fiber assets.

• Focus remains on cost reductions, monetizing acquired assets, expanding wavelength and optical transport services, and growing more profitable On-Net services.

• Total cash and restricted cash at quarter-end was $369.7 million, with a quarterly dividend of $0.02 per share approved.

• Proven track record of integrating acquisitions and driving margin expansion.

Financial highlights

• Q2 2026 total/service revenue: $235.6 million, down 1.5% sequentially and 4.3% year-over-year.

• Wavelength revenue grew 63.8% year-over-year to $14.8 million, with customer connections up 66.4%.

• On-net revenue was $135.4 million, up 2.3% year-over-year; off-net revenue was $84.5 million, down 17.3% year-over-year.

• Adjusted EBITDA was $71.1 million, margin 30.2%; GAAP gross margin improved to 24.5%, non-GAAP gross margin reached 47.0%.

• Net income for Q2 2026 was $66.6 million, reversing a net loss of $57.8 million in Q2 2025.

Outlook and guidance

• Multi-year revenue growth expected between 6% and 8%, with EBITDA margins anticipated to expand by approximately 200 basis points annually.

• CapEx expected to continue declining both sequentially and year-over-year.

• Management expects to refinance 2027 Notes and 2027 Mirror Notes in Q3 2026, subject to market conditions.

• Dividend payments have been reduced to $0.02 per share per quarter, with future dividends subject to board discretion and financial performance.