Cogent Communications reported $240.5 million in service revenue for Q4 2025, down 0.6% sequentially and 4.7% year over year, as the company continued to shift its infrastructure mix toward owned fiber and optical wavelength services. Full-year 2025 service revenue totaled $975.8 million, compared with $1.036 billion in 2024. On a constant currency basis, revenue declined 0.5% sequentially and 5.7% year over year in Q4. IP network traffic increased 4% from Q3 and 10% from a year earlier, signaling steady backbone utilization despite top-line pressure.
The company accelerated growth in its optical wave segment following its Sprint wireline acquisition. Wavelength revenue reached $12.1 million in Q4, up 18.8% sequentially and 73.7% year over year. For the full year, wavelength revenue doubled to $38.5 million. Wave-enabled locations expanded to 1,068 across the U.S., Mexico, and Canada, while wavelength customer connections climbed 84.6% year over year to 2,064. On-net buildings increased to 3,579, including 1,511 carrier-neutral data centers and 87 edge data centers, reinforcing Cogent’s strategy to monetize predominantly owned intercity fiber.
At the same time, off-net and enterprise segments contracted. Off-net revenue fell 17.9% year over year in Q4 to $92.9 million, and enterprise revenue continued to decline sequentially. Total customer connections decreased 4.7% year over year to 117,643, driven by a 14.9% drop in off-net connections. Adjusted EBITDA rose to $76.7 million in Q4, with margin expanding to 31.9%. Cash payments under the IP Transit Services Agreement with T-Mobile US, Inc. totaled $100 million for 2025, down from $204.2 million in 2024. Cogent approved a $0.02 per share dividend for Q1 2026.
• Wavelength revenue: $12.1M in Q4 (+18.8% QoQ, +73.7% YoY); $38.5M FY2025 (+100.3%)
• Wave-enabled locations: 1,068; on-net buildings: 3,579 (+126 YoY)
• IPv4 leasing revenue: $64.5M in FY2025 (+43.8%)
• Off-net revenue: $92.9M in Q4 (−17.9% YoY)
• Adjusted EBITDA margin: 31.9% in Q4 (up from 26.5% YoY)
• Net leverage ratio (adjusted for T-Mobile receivables): 6.64x at year-end
“We continued to expand our optical wavelength footprint while maintaining disciplined cost control across our network operations,” the company stated.
🌐 Analysis: Cogent’s results underscore a structural pivot from leased last-mile connectivity toward higher-margin, facilities-based wave services built on owned fiber assets. The decline in enterprise and off-net segments reflects competitive pricing pressure in DIA and Ethernet markets, while wavelength growth aligns with broader industry demand for high-capacity interconnection tied to AI workloads and data center expansion. As competitors invest heavily in metro fiber densification and long-haul upgrades, Cogent’s ability to convert Sprint-era assets into sustainable wave revenue will shape its leverage profile and long-term margin trajectory.
