What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-11-06 compared with 2025-08-07 · 182 added, 193 removed, 589 unchanged (39% of the section changed)

8 unchanged sentences

Factors that could cause or contribute to these differences include, but are not limited to:

Our acquisition of Sprint Communications, (as defined below), now called Cogent Fiber, LLC, including difficulties integrating our business with the Cogent Fiber Business, which may result in the combined company not operating as effectively and efficiently as expected;

Our acquisition of Sprint Communications, now called Cogent Fiber, LLC, including difficulties integrating our business with the Cogent Fiber Business, which may result in the combined company not operating as effectively and efficiently as expected;

transition services required to support the Cogent Fiber Business and the related costs continuing for a period longer than expected, government policies worldwide;

17 unchanged sentences

On May 1, 2023 (the “Closing Date”), Cogent Infrastructure, Inc.

(now Cogent Infrastructure, LLC), a Delaware corporation and our direct wholly owned subsidiary (the “Buyer” or “Cogent Infrastructure”, “we” or “us”), closed on its acquisition of the U.S.

(now Cogent Infrastructure, LLC), a Delaware corporation and our direct wholly owned subsidiary (the “Buyer”, “Cogent Infrastructure”, “we” or “us”), closed on its acquisition of the U.S.

long-haul fiber network (including the non-U.S.

16 unchanged sentences

On the Closing Date, we entered into an agreement for IP transit services (“IP Transit Services Agreement”), pursuant to which T-Mobile USA, Inc., a Delaware corporation and direct subsidiary of T-Mobile (“ TMUSA”) will pay us an aggregate of $700.0 million, consisting of (i) $350.0 million in equal monthly installments of $29.2 million per month during the first year after the Closing Date and (ii) $350.0 million in equal monthly installments of $8.3 million per month over the subsequent 42 months.

Under the IP Transit Services Agreement, TMUSA paid us $25.0 million and $66.7 million during the three months ended June 30, 2025 and 2024, respectively and TMUSA paid us $50.0 million and $154.2 million during the six months ended June 30, 2025 and 2024, respectively

Under the IP Transit Services Agreement, TMUSA paid us $25.0 million and $25.0 million during the three months ended September 30, 2025 and 2024, respectively, and TMUSA paid us $75.0 million and $179.2 million during the nine months ended September 30, 2025 and 2024, respectively.

We accounted for the Transaction as a business combination under ASC Topic 805 Business Combinations (“ASC 805”).

6 unchanged sentences

The interest rate used in determining the present value was derived considering rates on similar issued debt instruments with comparable durations, among other market factors.

The determination of the discount rate requires some judgment.

The determination of the discount rate required some judgment.

Transition Services Agreement

14 unchanged sentences

The Purchase Agreement also provided for reimbursement from the Seller to us for qualifying severance expenses incurred.

Total qualifying severance expenses were $28.6 million of which $8.0 million and $12.3 million were recorded in the three and six months ended June 30, 2024 respectively.

These severance payments ended in the second quarter of 2024 and all were paid in full.

Total qualifying severance expenses were $28.6 million of which $12.3 million was recorded in the nine months ended September 30, 2024.

These severance payments ended in the second quarter of 2024 and were all paid in full.

Other Services Provided to the Seller

In addition, on the Closing Date, we entered into a commercial agreement (the “Commercial Agreement”) with TMUSA for colocation and connectivity services, pursuant to which we will provide such services to TMUSA for a per service monthly fee plus certain third-party costs incurred in providing the services.

Under the Commercial Agreement, we recorded revenue of $1.1 million and $5.9 million during the three months ended June 30, 2025 and 2024, respectively and we recorded revenue of $1.8 million and $9.1 million during the six months ended June 30, 2025 and 2024, respectively.

Under the Commercial Agreement, we recorded revenue of $0.4 million and $4.1 million during the three months ended September 30, 2025 and 2024, respectively, and we recorded revenue of $2.1 million and $13.2 million during the nine months ended September 30, 2025 and 2024, respectively.

Acquisition-Related Costs

In connection with the Transaction and negotiation of the Purchase Agreement, we incurred a total of $13.6 million of professional fees and other acquisition-related costs (not including severance costs) since the acquisition date.

Acquisition-related costs (not including severance costs) were $12.4 million for the three months ended June 30, 2024 and $21.4 million for the six months ended June 30, 2024.

There were no acquisition-related costs incurred in the three or six months ended June 30, 2025.

Acquisition-related costs (not including severance costs) were $21.4 million for the nine months ended September 30, 2024.

There were no acquisition-related costs incurred in the nine months ended September 30, 2025.

Competitive Advantages

14 unchanged sentences

We believe the vast majority of our competitors currently operate their networks with multiple protocols, and we believe that attempts to upgrade their networks to one protocol would be operationally challenging and costly.

Page 34 of 60

● Our IP Network .

3 unchanged sentences

In addition, with our acquisition of the Cogent Fiber Business, we now own a nationwide domestic fiber network (the “Sprint Network”).

Acquiring the Sprint Network allows us to capitalize on the benefits of owning

Page 33 of 58

network without significant upfront capital investment.

Acquiring the Sprint Network allows us to capitalize on the benefits of owning network without significant upfront capital investment.

The Sprint Network is mostly complementary to our existing leased dark fiber network, offers unique geographic routes and will allow us to reduce our reliance on leased dark fiber.

This strategic combination of owned and leased dark fiber will help to ensure a robust and reliable network and enables us to connect via dark fiber to virtually any geographic route or facility we require on a long-term, cost-effective basis.

● Optical Wave Network - Acquiring the Sprint Network has also allowed us to construct a wavelength network using the predominantly owned fiber.

● Optical Wave Network.

Acquiring the Sprint Network has also allowed us to construct a wavelength network using the predominantly owned fiber.

This enables us to expand our product offerings to include optical wavelength and optical transport services.

We are selling these services to our existing customers, customers acquired with the Cogent Fiber Business and to new customers who require dedicated optical transport connectivity without the capital and ongoing expenses associated with owning and operating network infrastructure.

As of June 30, 2025, we offered this service in 938 wave-enabled data centers in the United States, Mexico and Canada.

As of September 30, 2025, we offered this service in 996 wave-enabled data centers in the United States, Mexico and Canada.

We believe our wavelength service has the advantages of unique routes, ubiquitous service locations, faster provisioning times and lower prices.

22 unchanged sentences

The vast majority of our on-net Internet and VPN services can be installed in less than two weeks, which is materially faster than the installation times for some of our incumbent competitors.

Page 35 of 60

High-Quality, Reliable Service.

5 unchanged sentences

We have systematically evaluated and chosen our network extensions to buildings, data centers and markets based upon a rigorous set of criteria to evaluate the economic opportunity of network locations.

Additional factors relevant to our pursuit of new buildings include the willingness of building owners to grant us access rights, the availability of optical

Page 34 of 58

fiber networks to serve those buildings, the costs to connect buildings to our network and equipment availability.

Additional factors relevant to our pursuit of new buildings include the willingness of building owners to grant us access rights, the availability of optical fiber networks to serve those buildings, the costs to connect buildings to our network and equipment availability.

We have also begun to evaluate the sustainability of new locations by evaluating the LEED Green Rating of Buildings, the potential to source renewable energy at locations and the potential impact of climate change on a location including proximity to water and the risk of flooding.

8 unchanged sentences

Our Cogent data centers, including our Cogent Edge data centers, are directly connected to our network and operate across the United States and in Europe, and comprise:

● Over 1.9 million square feet of floor space, and

● 2.1 million square feet of floor space, and

● 212 MW of power.

7 unchanged sentences

o 11,013 enterprise customer connections.

Page 36 of 60

Because of these bases of customers who distribute (content providers) and receive (access networks) content on our network, we believe that the majority of all the traffic remains “on-net” by both originating and terminating on our network.

6 unchanged sentences

The members of our senior management team have an average of over 20 years of experience in the telecommunications industry and many have been working together at the Company for several years.

Several members of the senior management team have been working together at

Page 35 of 58

the Company since 2000.

Several members of the senior management team have been working together at the Company since 2000.

Our senior management team has designed and built our network and, during our formative years, led the integration of network assets we acquired through 13 significant acquisitions prior to our acquisition of the Cogent Fiber Business and managed the expansion and growth of our business.

22 unchanged sentences

● High capacity and reliability – We offer 100 Mbps to 100 Gbps ports in all of the CNDCs and 400 Gbps in selected locations on our network, which differentiates the capacity choices we provide our net-centric clients;

Page 37 of 60

● Balanced customer base for IP services – Our leading share of content providers and access networks increases the amount of traffic that originates and terminates on our network thereby reducing latency and enhancing reliability;

3 unchanged sentences

Our high-capacity network provides us with the ability to add a significant number of customers to our network with minimal direct incremental costs.

We intend to increase usage of our network and operational

Page 36 of 58

infrastructure by adding customers in our existing on-net buildings, as well as developing additional markets and connecting more MTOBs and CNDCs to our network.

We are also upgrading our network and operational infrastructure to provide wave and optical transport services in more of our on-net buildings.

We intend to increase usage of our network and operational infrastructure by adding customers in our existing on-net buildings, as well as developing additional markets and connecting more MTOBs and CNDCs to our network.

We also upgraded our network and operational infrastructure to provide wave and optical transport services in more of our on-net buildings.

We emphasize our on-net services because they generate greater profit margins and we have more control over service levels, quality and pricing, and our on-net services are provisioned in considerably less time than our off-net services.

18 unchanged sentences

Expand our Data Center Footprint .

We currently operate a number of Cogent data centers across the United States and Europe.

We operate a total of 187 total data centers including:

We currently operate 186 Cogent data centers across the United States and Europe, including:

● 100 larger Cogent “classic” data centers;

● 86 smaller Cogent edge data centers.

Page 38 of 60

In connection with our acquisition of the Cogent Fiber Business, we acquired multiple Sprint facilities that previously housed Sprint equipment.

1 unchanged sentence

Repurposing these facilities included removing unused, obsolete equipment and racks, and upgrading or installing new HVAC systems, uninterruptable power supplies, backup generators and fire suppression systems as well as other structural changes.

By June 30, 2025, we had converted the former Sprint facilities into 52 Cogent data centers and 86 Cogent edge data centers.

By September 30, 2025, we had converted the former Sprint facilities into 52 Cogent data centers and 86 Cogent edge data centers.

In connection with this conversion process, we also decommissioned certain legacy Cogent data centers.

2 unchanged sentences

We also provide a small number of free IPv4 addresses to our dedicated Internet access customers.

We currently own approximately 38 million IPv4 addresses, of which 9.9 million were recently acquired at the closing of the Sprint acquisition.

We currently lease 13.2 million of our IPv4 addresses to our customers on contracts

Page 37 of 58

with service terms ranging from one month to five years.

We currently own approximately 38 million IPv4 addresses.

We currently lease 14.6 million of our IPv4 addresses to our customers on contracts with service terms ranging from one month to five years.

We intend to continue to lease IPv4 addresses to our customers as well as explore alternatives for monetizing our IPv4 address inventory.

Monetize Acquired Data Center Facilities .

We are actively marketing the sale or lease of twenty-four data center facilities acquired in the Transaction.

In October 2025, we entered into a non-binding letter of intent “(LOI”) for the sale of two data center facilities and the associated land for $144.0 million in cash.

The LOI includes certain contingencies, including the completion of further due diligence by the prospective buyer and negotiation and execution of a definitive purchase and sale agreement.

Results of Operations

Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024

Three Months Ended September 30, 2025 Compared to the Three Months Ended September 30, 2024

Our management reviews and analyzes several key financial measures in order to manage our business and assess the quality and variability of our service revenue, operating results and cash flows.

2 unchanged sentences

Three Months Ended

September 30,

(in thousands)

2 unchanged sentences

Selling, general, and administrative (“SG&A”) expenses (2)

Sprint acquisition costs

Depreciation and amortization expenses

Gain on lease termination

Gain on bargain purchase – Sprint acquisition

Gains on lease terminations and other

Interest income – IP Transit Services Agreement

Loss on debt extinguishment and redemption – 2026 notes

Interest expense – including change in valuation of interest rate swap agreement

Income tax benefit

(1) Includes non-cash equity-based compensation expenses of $506 and $350 in the three months ended June 30, 2025 and 2024, respectively.

(2) Includes non-cash equity-based compensation expenses of $4,158 and $3,215 in the three months ended June 30, 2025 and 2024, respectively.

(1) Includes non-cash equity-based compensation expenses of $570 and $469 in the three months ended September 30, 2025 and 2024, respectively.

(2) Includes non-cash equity-based compensation expenses of $8,362 and $7,406 in the three months ended September 30, 2025 and 2024, respectively.

NM – not meaningful

6 unchanged sentences

In the net-centric market, we offer comparable services in terms of capacity but typically at significantly lower prices.

Our service revenue decreased by 5.5% from the three months ended June 30, 2024 to the three months ended June 30, 2025.

Exchange rates positively impacted our service revenue by $1.5 million reflecting the impact of translating our service revenue for the three months ended June 30, 2025 at the average foreign currency exchange rates for the three months ended June 30, 2024.

Our total service revenue decreased from the cancellation of low margin and non-core customers we acquired with the Cogent Fiber Business, and a reduction in revenue under the Commercial Agreement with TMUSA, partially offset by the growth in customers from expanding our network and offering wavelength services, adding additional buildings to our network, increasing our penetration into the buildings connected to our network and gaining market share by offering our services at lower prices than our competitors.

Page 39 of 60

Our service revenue decreased by 5.9% from the three months ended September 30, 2024 to the three months ended September 30, 2025.

Exchange rates positively impacted our service revenue by $1.8 million, reflecting the impact of translating our service revenue for the three months ended September 30, 2025 at the average foreign currency exchange rates for the three months ended September 30, 2024.

Our total service revenue decreased from the cancellation of low-margin and non-core customers we acquired with the Cogent Fiber Business, and a reduction in revenue under the Commercial Agreement with TMUSA, partially offset by the growth in customers from expanding our network and offering wavelength services, adding additional buildings to our network, increasing our penetration into the buildings connected to our network and gaining market share by offering our services at lower prices than our competitors.

Revenue recognition standards include guidance relating to any tax assessed by a governmental authority that is directly imposed on a revenue-producing transaction between a seller and a customer and may include, but is not limited to, gross receipts taxes, Universal Service Fund fees and certain state regulatory fees.

We record these taxes billed to our customers on a gross basis (as service revenue and network operations expense) in our condensed consolidated statements of comprehensive loss.

The impact of these taxes including the Universal Service Fund resulted in an increase to our revenues of $0.8 million from the three months ended June 30, 2024 to the three months ended June 30, 2025.

The impact of these taxes including the Universal Service Fund, resulted in a decrease to our revenues of $0.6 million from the three months ended September 30, 2024 to the three months ended September 30, 2025.

Three Months Ended

September 30,

Other Operating Data

10 unchanged sentences

We began to serve enterprise customers in connection with our acquisition of the Cogent Fiber Business.

We define “enterprise” customers as large corporations (typically, Fortune 500 companies with greater than $5 billion in annual revenue) running Wide Area Networks (“WAN”) with several dozen to several hundred sites.

We define “enterprise” customers as large corporations (typically, Fortune 500 companies with greater than $5 billion in annual revenue) running Wide Area Networks (“WANs”) with several dozen to several hundred sites.

Our enterprise customers generally purchase our services on a price per location basis.

On the Closing Date, we acquired;

Page 40 of 60

On the Closing Date, with the Cogent Fiber Business we acquired:

● 17,823 corporate customer connections,

● 5,711 net-centric customer connections and

● 23,209 enterprise customer connections with the Cogent Fiber Business.

Page 39 of 58

● 23,209 enterprise customer connections.

We classified the $39.5 million of May 2023 Cogent Fiber Business revenue as:

2 unchanged sentences

● $6.5 million of monthly recurring revenue as net-centric revenue.

Revenues from our corporate, net-centric and enterprise customers represented 44.3%, 39.5% and 16.2% of total service revenue, respectively, for the three months ended June 30, 2025 and represented 45.9%, 35.0% and 19.1% of total service revenue, respectively, for the three months ended June 30, 2024.

Revenues from our corporate, net-centric and enterprise customers represented 43.5%, 41.5% and 15.1% of total service revenue, respectively, for the three months ended September 30, 2025 and represented 45.2%, 35.7% and 19.1% of total service revenue, respectively, for the three months ended September 30, 2024.

Our revenue from our corporate customers decreased primarily due to cancellations of low margin and non-core corporate customers acquired with the Cogent Fiber Business.

During the three months ended June 30, 2025, we continued to see declining vacancy rates compared to their peak during the COVID-19 pandemic and rising office occupancy rates in certain markets in which we operate continuing a trend that began following the end of the COVID-19 pandemic.

During the three months ended September 30, 2025, we continued to see declining vacancy rates compared to their peak during the COVID-19 pandemic and rising office occupancy rates in certain markets in which we operate continuing a trend that began following the end of the COVID-19 pandemic.

Other markets, particularly those in California, Washington D.C.

8 unchanged sentences

The net-centric market exhibits significant pricing pressure due to the continued introduction of new technology, which lowers the marginal cost of transmission and routing, and the commodity nature of the service where price is typically the only differentiating factor for these customers.

Our average price per megabit of our installed base of customers decreased by 30.1% from the three months ended June 30, 2024 to the three months ended June 30, 2025.

Our average price per megabit of our installed base of customers decreased by 31.0% from the three months ended September 30, 2024 to the three months ended September 30, 2025.

The impact of foreign exchange rates has a more significant impact on our net-centric revenues.

Our revenue from our enterprise customers decreased primarily due to a reduction in revenue from low-margin and non-core enterprise customers acquired with the Cogent Fiber Business.

Service revenue classified as on-net revenue and enterprise revenue from a low-margin resale customer acquired in connection with the Cogent Fiber Business was $3.9 million for the three months ended June 30, 2024.

The resale customer cancelled its service on June 1, 2024.

Revenue and customer connections by network connection type.

3 unchanged sentences

● $4.7 million of non-core revenue.

Page 41 of 60

Additionally, on the Closing Date, we classified the total 46,743 Cogent Fiber Business customer connections as:

1 unchanged sentence

● 24,667 off-net customer connections and

Page 40 of 58

● 20,516 non-core customer connections.

Revenues from our on-net, off-net, wavelength and non-core customers represented 53.7%, 41.5%, 3.7% and 1.1% of total service revenue, respectively, for the three months ended June 30, 2025 and represented 54.0%, 42.8%, 1.4% and 1.8% of total service revenue, respectively, for the three months ended June 30, 2024.

Our on-net revenues increased from the three months ended June 30, 2024 to the three months ended June 30, 2025, primarily from customers acquired with the Cogent Fiber Business and an increase in revenues from our legacy Cogent customers, partially offset by cancellation of service from one low-margin resale customer.

Service revenue classified as on-net revenue and enterprise revenue from a low margin resale customer acquired in connection with the Cogent Fiber Business was $3.9 million for the three months ended June 30, 2024.

The resale customer cancelled its service on June 1, 2024.

Our off-net revenues decreased from the three months ended June 30, 2024 to the three months ended June 30, 2025 primarily from cancellations of low-margin off-net customers and off-net customers in unlicensed markets that we acquired with the Cogent Fiber Business.

Revenues from our on-net, off-net, wavelength and non-core customers represented 55.9%, 39.3%, 4.2% and 0.6% of total service revenue, respectively, for the three months ended September 30, 2025 and represented 53.0%, 43.3%, 2.1% and 1.6% of total service revenue, respectively, for the three months ended September 30, 2024.

Our on-net revenues decreased from the three months ended September 30, 2024 to the three months ended September 30, 2025, primarily from terminations of customers acquired with the Cogent Fiber Business offsetting the increase in revenues from our legacy Cogent customers.

Our off-net revenues decreased from the three months ended September 30, 2024 to the three months ended September 30, 2025, primarily from cancellations of low-margin off-net customers and off-net customers in unlicensed markets that we acquired with the Cogent Fiber Business.

In connection with our acquisition of the Cogent Fiber Business, we expanded our offerings of optical wavelength and optical transport services over our fiber network.

Wavelength revenue was $9.1 million for the three months ended June 30, 2025 and $3.6 million for the three months ended June 30, 2024.

Our non-core revenues decreased from the three months ended June 30, 2024 to the three months ended June 30, 2025 from the cancellation of non-core revenues acquired in the Cogent Fiber Business.

Our wavelength revenue was $10.2 million for the three months ended September 30, 2025 and $5.3 million for the three months ended September 30, 2024.

Our non-core revenues decreased from the three months ended September 30, 2024 to the three months ended September 30, 2025 from the cancellation of non-core revenues acquired in the Cogent Fiber Business.

Non-core services are services, which we acquired and continue to support but do not actively sell.

5 unchanged sentences

Selling, General, and Administrative (“SG&A”) Expenses.

Our SG&A expenses, including non-cash equity-based compensation expense, decreased by 5.0% from the three months ended June 30, 2024 to the three months ended June 30, 2025.

Our decrease in SG&A operations expense is primarily attributable to our efforts to reduce SG&A costs related to our acquisition of the Cogent Fiber Business.

These costs primarily include compensation and related costs and third-party services costs.

Our SG&A expenses, including non-cash equity-based compensation expense, increased by 4.1% from the three months ended September 30, 2024 to the three months ended September 30, 2025.

Our increase in SG&A operations expense is primarily attributable to the effective termination of TSA fees charged to T-Mobile in early 2025 that reduced our SG&A costs in the three months ended September 30, 2024.

The services provided by us to T-Mobile under the TSA included, among others, information technology and network support, finance and back office and other wireless business support.

Non-cash equity-based compensation expense is included in SG&A expenses consistent with the classification of the employee’s salary and other compensation.

Acquisition-Related Costs.

In connection with the Transaction and negotiation of the Purchase Agreement, we incurred cumulative professional fees, other acquisition related costs totaling $42.1 million, including $28.6 million of reimbursed severance costs.

Such fees totaled $12.4 million for the three months ended June 30, 2024.

There were no acquisition related costs recorded in the three months ended June 30, 2025.

Depreciation and Amortization Expenses.

Our depreciation and amortization expense increased by 1.7% primarily due to the depreciation expense associated assets acquired with the Cogent Fiber Business and an increase in deployed fixed assets.

Gain on Lease Termination.

In June 2024, we elected to exercise a contractual option to prepay in full at a 12.0% discounted rate an IRU finance lease agreement between a us and a vendor we assumed with the Cogent Fiber Business for $114.6 million.

At the payment date, the present value of the IRU finance lease liability was $117.9 million and the remaining $4.2 million monthly principal payments totaled $130.2 million.

The prepayment resulted in a gain on lease termination of $3.3 million related to the difference between the book value of $117.9 million and the cash payment of $114.6 million.

We are continuing to use the related IRU asset.

Gain on Bargain Purchase.

We accounted for the Transaction as a business combination.

The identifiable assets acquired and liabilities assumed were recorded at their fair values as of the acquisition date.

Assigning fair market values to the assets acquired and

Our depreciation and amortization expense decreased by 29.6% primarily due to the completion of the depreciation of network equipment assets acquired with the Cogent Fiber Business that had an estimated useful life of approximately two years from the acquisition date.

Gains on Lease Terminations and Other.

The $2.5 million gain for the nine months ended September 30, 2025 primarily resulted from the termination of certain dark fiber leases that were no longer needed as the routes were considered to be redundant with the acquired Cogent Fiber Business network and a $0.7 million gain from the sale of a small parcel of land acquired with the Cogent Fiber Business.

Page 42 of 60

liabilities assumed at the date of an acquisition requires the use of significant judgment regarding estimates and assumptions.

During the three months ended June 30, 2024, we made certain adjustments to our estimates of the fair market value of the assets acquired and liabilities assumed resulting in increase to the gain on bargain purchase of $27.7 million for the three months ended June 30, 2024.

The total bargain purchase gain was $1.4 billion.

Interest Income - IP Transit Services Agreement .

1 unchanged sentence

The IP Transit Services Agreement was recorded in connection with the Transaction at its discounted present value resulting in a discount of $79.6 million.

The amortization of the discount resulted in interest income of $4.3 million for the three months ended June 30, 2025 and $5.9 million for the three months ended June 30, 2024.

Loss on Debt Extinguishment and Redemption - 2026 Existing Notes .

The amortization of the discount resulted in interest income of $3.9 million for the three months ended September 30, 2025 and $5.4 million for the three months ended September 30, 2024.

Interest Expense.

On June 17, 2025, Cogent Communications Group, LLC (“Group”) and Cogent Finance, Inc.

1 unchanged sentence

(“Holdings”), issued $600.0 million aggregate principal amount of our 6.50% Senior Secured Notes due 2032 (the “2032 Notes”).

The 2032 Notes were issued in connection with the extinguishment of our $500.0 million aggregate principal amount of 3.50% Senior Secured Notes that were due in May 2026 that we issued in May 2021 (the “Existing 2026 Notes”), The net proceeds from the 2032 Notes offering were $597.8 million after deducting offering expenses.

The net proceeds from the 2032 Notes offering were $597.8 million after deducting offering expenses.

We used $507.3 million of the net proceeds from the 2032 Notes offering to redeem in full, and satisfy and discharge our obligations under our Existing 2026 Notes.

The obligations under our Existing 2026 Notes included the $500.0 million principal amount, a $5.0 million settlement payment and $2.2 million of accrued interest.

As a result of the redemption of the Existing 2026 Notes we incurred a loss on debt extinguishment and redemption of $5.6 million.

Interest Expense.

Our interest expense resulted from interest incurred on our:

6 unchanged sentences

● Finance lease obligations.

As of June 30, 2025, the fair value of our Swap Agreement was a net liability of $13.6 million.

As of September 30, 2025, the fair value of our Swap Agreement was a net liability of $13.8 million.

Changes in the valuation of the Swap Agreement are related changes in interest rates and are included in interest expense.

Our interest expense increased by 34.7% from the three months ended June 30, 2024 to the three months ended June 30, 2025, primarily due to the May 2024 issuance of our $206.0 million of Existing IPv4 Notes, the April 2025 issuance of $174.4 million of our New IPv4 Notes and the June 2024 issuance of our $300.0 million 2027 Mirror Notes.

Our interest expense increased by 61.4% from the three months ended September 30, 2024 to the three months ended September 30, 2025, primarily due to the May 2024 issuance of our $206.0 million of Existing IPv4 Notes, the April 2025 issuance of our $174.4 million New IPv4 Notes, the June 2024 issuance of our $300.0 million 2027 Mirror Notes and the June 2025 issuance of our $600.0 million 2032 Notes.

Income Tax Benefit.

Our income tax benefit was $16.7 million for the three months ended June 30, 2025 and $7.9 million for the three months ended June 30, 2024.

Our income tax benefit was $11.1 million for the three months ended September 30, 2025 and $16.9 million for the three months ended September 30, 2024.

The change in our income tax benefit is primarily related to projected operating results related to the Cogent Fiber Business acquisition and the timing of the reversal of deferred tax liabilities acquired with the Cogent Fiber Business.

Page 42 of 58

Buildings On-net.

As of June 30, 2025, and 2024, we had a total of 3,529 and 3,386 on-net buildings connected to our network, respectively.

As of September 30, 2025, and 2024, we had a total of 3,537 and 3,424 on-net buildings connected to our network, respectively.

The increase in our on-net buildings was a result of our disciplined network expansion program.

We anticipate adding a similar number of buildings to our network for the next several years.

Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024

Page 43 of 60

Nine months Ended September 30, 2025 Compared to the Nine months Ended September 30, 2024

Our management reviews and analyzes several key financial measures in order to manage our business and assess the quality and variability of our service revenue, operating results and cash flows.

1 unchanged sentence

The comparisons illustrated in the tables are discussed in greater detail below.

Six Months Ended

Nine months Ended

September 30,

(in thousands)

4 unchanged sentences

Depreciation and amortization expenses

Gain on lease termination

Gains on lease terminations and other

Gain on bargain purchase – Sprint

3 unchanged sentences

Income tax benefit

(1) Includes non-cash equity-based compensation expenses of $996 and $385 in the six months ended June 30, 2025 and 2024, respectively.

(2) Includes non-cash equity-based compensation expenses of $11,681 and $10,131 in the six months ended June 30, 2025 and 2024, respectively.

(1) Includes non-cash equity-based compensation expenses of $1,566 and $1,204 in the nine months ended September 30, 2025 and 2024, respectively.

(2) Includes non-cash equity-based compensation expenses of $20,043 and $17,186 in the nine months ended September 30, 2025 and 2024, respectively.

NM – not meaningful

6 unchanged sentences

In the net-centric market, we offer comparable services in terms of capacity but typically at significantly lower prices.

Our service revenue decreased by 6.3% from the six months ended June 30, 2024 to the six months ended June 30, 2025.

Exchange rates positively impacted our service revenue by $0.2 million reflecting the impact of translating our service revenue for the six months ended June 30, 2025 at the average foreign currency exchange rates for the six months ended June 30, 2024.

Our service revenue decreased by 6.2% from the nine months ended September 30, 2024 to the nine months ended September 30, 2025.

Exchange rates positively impacted our service revenue by $1.9 million reflecting the impact of translating our service revenue for the nine months ended September 30, 2025, at the average foreign currency exchange rates for the nine months ended September 30, 2024.

2 unchanged sentences

We record these taxes billed to our customers on a gross basis (as service revenue and network operations expense) in our condensed consolidated statements of comprehensive loss.

The impact of these taxes including the Universal Service Fund resulted in an increase to our revenues of $0.5 million from the six months ended June 30, 2024 to the six months ended June 30, 2025.

Six Months Ended

The impact of these taxes including the Universal Service Fund resulted in a decrease to our revenues of $0.1 million from the nine months ended September 30, 2024 to the nine months ended September 30, 2025.

Nine months Ended

September 30,

Other Operating Data

12 unchanged sentences

Our enterprise customers generally purchase our services on a price per location basis.

On the Closing Date, we acquired:

On the Closing Date, with the Cogent Fiber Business we acquired:

● 17,823 corporate customer connections,

● 5,711 net-centric customer connections and

● 23,209 enterprise customer connections with the Cogent Fiber Business.

● 23,209 enterprise customer connections.

Page 45 of 60

3 unchanged sentences

● $6.5 million of monthly recurring revenue as net-centric revenue.

Revenues from our corporate, net-centric and enterprise customers represented 44.5%, 38.5% and 17.0% of total service revenue, respectively, for the six months ended June 30, 2025 and represented 46.4%, 34.8% and 18.8% of total service revenue, respectively, for the six months ended June 30, 2024.

Revenues from our corporate, net-centric and enterprise customers represented 44.2%, 39.5% and 16.3% of total service revenue, respectively, for the nine months ended September 30, 2025 and represented 46.0%, 35.1% and 18.9% of total service revenue, respectively, for the nine months ended September 30, 2024.

Our revenue from our corporate customers decreased primarily due to cancellations of low margin and non-core corporate customers acquired with the Cogent Fiber Business.

Our corporate customers take advantage of our superior speeds, greater aggregate throughput, service levels and installation times versus our competitors During the six months ended June 30, 2025, we continued to see declining vacancy rates compared to their peak during the COVID-19 pandemic and rising office occupancy rates in certain markets in which we operate continuing a trend that began following the end of the COVID-19 pandemic.

Our corporate customers take advantage of our superior speeds, greater aggregate throughput, service levels and installation times versus our competitors During the nine months ended September 30, 2025, we continued to see declining vacancy rates compared to their peak during the COVID-19 pandemic and rising office occupancy rates in certain markets in which we operate continuing a trend that began following the end of the COVID-19 pandemic.

Other markets, particularly those in California, Washington D.C.

8 unchanged sentences

Our average price per megabit of our installed base of customers decreased by 21.0% from the six months ended June 30, 2024 to the six months ended June 30, 2025.

Our average price per megabit of our installed base of customers decreased by 28.6% from the nine months ended September 30, 2024 to the nine months ended September 30, 2025.

The impact of foreign exchange rates has a more significant impact on our net-centric revenues.

Our revenue from our enterprise customers decreased primarily due to a reduction in revenue from low-margin and non-core enterprise customers acquired with the Cogent Fiber Business.

Service revenue classified as on-net revenue and enterprise revenue from a low-margin resale customer acquired in connection with the Cogent Fiber Business was $9.7 million for the six months ended June 30, 2024.

The resale customer cancelled its service on June 1, 2024.

4 unchanged sentences

● $4.7 million of non-core revenue.

Page 46 of 60

Additionally, on the Closing Date, we classified the total 46,743 Cogent Fiber Business customer connections as:

1 unchanged sentence

● 24,667 off-net customer connections and

Page 45 of 58

● 20,516 non-core customer connections.

Revenues from our on-net, off-net, wavelength and non-core customers represented 53.1%, 42.4%, 3.3% and 1.2% of total service revenue, respectively, for the six months ended June 30, 2025 and represented 53.1%, 43.6%, 1.3% and 2.0% of total service revenue, respectively, for the six months ended June 30, 2024.

Our on-net revenues increased from the six months ended June 30, 2024 to the six months ended June 30, 2025, primarily from customers acquired with the Cogent Fiber Business and an increase in revenues from our legacy Cogent customers, partially offset by cancellation of service from one low-margin resale customer under an uneconomic contract.

Service revenue classified as on-net revenue and enterprise revenue from this low-margin resale customer acquired in connection with the Cogent Fiber Business was $9.7 million for the six months ended June 30, 2024.

Revenues from our on-net, off-net, wavelength and non-core customers represented 54.0%, 41.4%, 3.6% and 1.0% of total service revenue, respectively, for the nine months ended September 30, 2025 and represented 53.0%, 43.5%, 1.6% and 1.9% of total service revenue, respectively, for the nine months ended September 30, 2024.

Our on-net revenues decreased from the nine months ended September 30, 2024 to the nine months ended September 30, 2025, primarily from terminations from customers acquired with the Cogent Fiber Business more than offsetting the increase in revenues from our legacy Cogent customers.

The resale customer cancelled its service on June 1, 2024.

Our off-net revenues decreased from the six months ended June 30, 2024 to the six months ended June 30, 2025 primarily from cancellations of low-margin off-net customers and off-net customers in unlicensed markets that we acquired with the Cogent Fiber Business.

Our off-net revenues decreased from the nine months ended September 30, 2024 to the nine months ended September 30, 2025, primarily from cancellations of low-margin off-net customers and off-net customers in unlicensed markets that we acquired with the Cogent Fiber Business.

In connection with our acquisition of the Cogent Fiber Business, we expanded our offerings of optical wavelength and optical transport services over our fiber network.

Wavelength revenue was $16.2 million for the six months ended June 30, 2025 and $7.0 million for the six months ended June 30, 2024.

Our non-core revenues decreased from the six months ended June 30, 2024 to the six months ended June 30, 2025 from the cancellation of non-core revenues acquired in the Cogent Fiber Business.

Non-core services are services, which we acquired and continue to support but do not actively sell.

Wavelength revenue was $26.4 million for the nine months ended September 30, 2025 and $12.2 million for the nine months ended September 30, 2024.

Our non-core revenues decreased from the nine months ended September 30, 2024 to the nine months ended September 30, 2025 from the cancellation of non-core revenues acquired in the Cogent Fiber Business.

Non-core services are services, that we acquired and continue to support but do not actively sell.

Network Operations Expenses.

4 unchanged sentences

Selling, General, and Administrative (“SG&A”) Expenses.

Our SG&A expenses, including non-cash equity-based compensation expense, decreased by 4.5% from the six months ended June 30, 2024 to the six months ended June 30, 2025.

Our SG&A expenses, including non-cash equity-based compensation expense, decreased by 1.6% from the nine months ended September 30, 2024 to the nine months ended September 30, 2025.

Our decrease in SG&A operations expense is primarily attributable to our efforts to reduce SG&A costs related to our acquisition of the Cogent Fiber Business.

3 unchanged sentences

In connection with the Transaction and negotiation of the Purchase Agreement, we incurred cumulative professional fees and other acquisition related costs totaling $42.1 million, including $28.6 million of reimbursed severance costs.

Such fees totaled $21.4 million for the six months ended June 30, 2024.

There were no acquisition related costs recorded in the six months ended June 30, 2025.

Such fees totaled $21.4 million for the nine months ended September 30, 2024.

There were no acquisition related costs recorded in the nine months ended September 30, 2025.

Depreciation and Amortization Expenses.

Our depreciation and amortization expense increased by 4.4% primarily due to the depreciation expense associated assets acquired with the Cogent Fiber Business and an increase in deployed fixed assets.

Gain on Lease Termination.

Our depreciation and amortization expense decreased from the nine months ended September 30, 2024 to the nine months ended September 30, 2025 by 8.2% primarily due to the completion of the depreciation of network equipment assets acquired with the Cogent Fiber Business that had an estimated useful life of approximately two years from the acquisition date.

Page 47 of 60

Gains on Lease Terminations and Other.

In June 2024, we elected to exercise a contractual option to prepay in full at a 12.0% discounted rate an IRU finance lease agreement between us and a vendor we assumed with the Cogent Fiber Business for $114.6 million.

At the payment date, the present value of the IRU finance lease liability was $117.9 million and the remaining $4.2 million monthly principal payments totaled $130.2 million.

1 unchanged sentence

We are continuing to use the related IRU asset.

Gain on Bargain Purchase.

1 unchanged sentence

The identifiable assets acquired and liabilities assumed were recorded at their fair values as of the acquisition date.

Assigning fair market values to the assets acquired and

Page 46 of 58

liabilities assumed at the date of an acquisition requires the use of significant judgment regarding estimates and assumptions.

During the six months ended June 30, 2024, we made certain adjustments to our estimates of the fair market value of the assets acquired and liabilities assumed resulting in increase to the gain on bargain purchase of $22.2 million for the six months ended June 30, 2024.

Assigning fair market values to the assets acquired and liabilities assumed at the date of an acquisition requires the use of significant judgment regarding estimates and assumptions.

During the nine months ended September 30, 2024, we made certain adjustments to our estimates of the fair market value of the assets acquired and liabilities assumed resulting in an increase to the gain on bargain purchase of $22.2 million for the nine months ended September 30, 2024.

The total bargain purchase gain was $1.4 billion.

2 unchanged sentences

The IP Transit Services Agreement was recorded in connection with the Transaction at its discounted present value resulting in a discount of $79.6 million.

The amortization of the discount resulted in interest income of $9.0 million for the six months ended June 30, 2025 and $13.3 million for the six months ended June 30, 2024.

Loss on Debt Extinguishment – Existing 2026 Notes .

The amortization of the discount resulted in interest income of $12.9 million for the nine months ended September 30, 2025 and $18.7 million for the nine months ended September 30, 2024.

Loss on Debt Extinguishment and Redemption – Existing 2026 Notes .

On June 17, 2025 we issued $600.0 million aggregate principal amount of our 6.50% Senior Secured Notes due 2032 (the “2032 Notes”).

2 unchanged sentences

We used $507.3 million of the net proceeds from the 2032 Notes offering to redeem in full, and satisfy and discharge our obligations under the 2026 Notes.

The obligations under the 2026 Notes included the $500.0 million principal amount, a $5.0 million settlement payment and $2.2 million of accrued interest.

As a result of the redemption of the Existing 2026 Notes we incurred a loss on debt extinguishment of $5.6 million.

The obligations under the 2026 Notes included the $500.0 million principal amount, a $5.0 million make-whole payment and $2.2 million of accrued interest.

As a result of the redemption of the Existing 2026 Notes we incurred a loss on debt extinguishment and redemption of $5.6 million.

Interest Expense.

7 unchanged sentences

● Finance lease obligations.

As of June 30, 2025, the fair value of our Swap Agreement was a net liability of $13.6 million.

As of September 30, 2025, the fair value of our Swap Agreement was a net liability of $13.8 million.

Changes in the valuation of our Swap Agreement are related changes in interest rates and are included in interest expense.

Our interest expense increased by 26.0% from the six months ended June 30, 2024 to the six months ended June 30, 2025, primarily due to the May 2024 issuance of our $206.0 million of Existing IPv4 Notes, the April 2025 issuance of $174.4 million of our New IPv4 Notes and the June 2024 issuance of our $300.0 million 2027 Mirror Notes.

Our interest expense increased by 37.1% from the nine months ended September 30, 2024 to the nine months ended September 30, 2025, primarily due to the May 2024 issuance of our $206.0 million of Existing IPv4 Notes, the April 2025 issuance of $174.4 million of our New IPv4

Page 48 of 60

Notes, the June 2024 issuance of our $300.0 million 2027 Mirror Notes and the June 2025 issuance of our $600.0 million of 2032 Notes.

Income Tax Benefit.

Our income tax benefit was $34.9 million for the six months ended June 30, 2025 and $27.0 million for the six months ended June 30, 2024.

Our income tax benefit was $46.0 million for the nine months ended September 30, 2025 and $43.9 million for the nine months ended September 30, 2024.

Buildings On-net.

As of June 30, 2025, and 2024, we had a total of 3,529 and 3,386 on-net buildings connected to our network, respectively.

As of September 30, 2025, and 2024, we had a total of 3,537 and 3,424 on-net buildings connected to our network, respectively.

The increase in our on-net buildings was a result of our disciplined network expansion program.

We anticipate adding a similar number of buildings to our network for the next several years.

Page 47 of 58

Liquidity and Capital Resources

3 unchanged sentences

Based on management’s internal modeling at the culmination of the due diligence process, management determined this cash payment to be $700.0 million.

Management intends to reduce the negative cash flow of the Cogent Fiber Business through the payments from the IP Transit Services Agreement, reducing operating costs and increasing revenue primarily by providing optical wavelength and optical transport services over our fiber network, including the owned network we acquired with the Cogent Fiber Business.

We are selling these services to our existing customers, customers we acquired with the Cogent Fiber Business and to new customers who require dedicated optical transport connectivity without the capital and ongoing expenses associated with owning and operating network infrastructure.

1 unchanged sentence

Under the IP Transit Services Agreement, TMUSA will pay us an aggregate of $700.0 million, consisting of (i) $350.0 million in equal monthly installments of $29.2 million per month during the first year after the Closing Date and (ii) $350.0 million in equal monthly installments of $8.3 million per month over the subsequent 42 months.

Through June 30, 2025, we received monthly payments totaling $458.3 million under the IP Transit Services Agreement, reflected as cash flows from investing activities in our condensed consolidated statements of cash flows.

Through September 30, 2025, we received monthly payments totaling $483.3 million under the IP Transit Services Agreement, reflected as cash flows from investing activities in our condensed consolidated statements of cash flows.

As our business has grown as a result of an increasing customer base, the Transaction, broader geographic coverage and increased traffic on our network, we have historically produced a growing level of cash provided by operating activities.

Since we closed the Transaction we experienced a reduction of cash provided by operating activities from the impact of the Transaction.

Since we closed the Transaction, we have experienced a reduction of cash provided by operating activities from the impact of the Transaction.

The cash received from the IP Transit Services Agreement was designed to offset operating losses associated with the Cogent Fiber Business.

Increasing our cash provided by operating activities is, in part, dependent upon our ability to reduce the operating costs of the Cogent Fiber Business while retaining its profitable revenue, expanding our geographic footprint and increasing our revenues from our wavelength and optical network services.

During the first six months of 2025, we have received a total of $50.0 million under the IP Transit Services Agreement.

During the first nine months of 2025, we have received a total of $75.0 million under the IP Transit Services Agreement.

During the remainder of 2025, we expect to receive a total of $25.0 million under the monthly payments under the IP Transit Services Agreement.

This includes six monthly payments of $8.3 million each.

This includes three monthly payments of $8.3 million each.

Potential Sale of Acquired Data Centers

In October 2025, we entered into a non-binding letter of intent “(LOI”) for the sale of two data center facilities (the “Facilities”) and the associated land for $144.0 million in cash.

The LOI includes certain contingencies, including the completion of further due diligence by the prospective buyer and negotiation and execution of a definitive purchase and sale agreement.

The Facilities are owned real estate acquired and repurposed by us in the Transaction.

Page 49 of 60

Liquidity and cash obligations

5 unchanged sentences

Over the next several years, we have significant contractual and anticipated cash outlays including our indicative dividend payments on our common stock, our maturing debt obligations, interest payments on our debt obligations and Swap Agreement and our projected capital expenditure requirements in order to help execute our business plan including the continued integration of the Cogent Fiber Business.

Based upon the historical growth rate of our dividend, we expect that we would have to provide approximately $399 million in order to meet our expected quarterly dividend payments over the next two years.

Page 48 of 58

The long-term debt interest obligations and maturity dates of our long-term debt obligations are as follows:

6 unchanged sentences

These settlement payments are made in November and May of each year until the Swap Agreement expires in February 2026.

As of June 30, 2025, $13.6 million of our cash and cash equivalents are restricted for use under our Swap Agreement.

As of September 30, 2025, $13.8 million of our cash and cash equivalents are restricted for use under our Swap Agreement.

We have made a $14.3 million deposit with the counterparty to the Swap Agreement.

6 unchanged sentences

We or our affiliates may, at any time and from time to time, seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise.

Such repurchases or exchanges, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

Such repurchases or exchanges, if any, will be upon such terms and at such prices as we may determine, and

Page 50 of 60

will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

The amounts involved may be material.

In light of the economic uncertainties associated with the global economy, including due to the impact from tariffs and trade restrictions, the cash flow requirements of the Cogent Fiber Business, the lingering impact of the COVID-19 pandemic and recent bank failures and liquidity concerns at certain other banks, our executive officers and Board of Directors have continued to carefully monitor our liquidity and cash requirements.

Based on current circumstances, we currently plan to continue our current dividend policy.

Based on current circumstances, we have decreased our quarterly dividend to $0.02 per share of common stock for the dividend to be paid in the fourth quarter of 2025.

Any future determination regarding dividends, including a decision to increase our quarterly dividend, will be at the discretion of the Board and will depend on the Company’s financial condition, results of operations, capital requirements, any legal or contractual restrictions on the payment of dividends, and other factors the Board deems relevant.

Given uncertainties regarding the potential impact of tariffs and trade restrictions, the global economy, lingering business impact of the pandemic, and the cash flow requirements of the Cogent Fiber Business, we will continue to monitor our capital spending.

1 unchanged sentence

Cash, cash equivalents and restricted cash

As of June 30, 2025, we had cash, cash equivalents and restricted cash of $306.7 million.

Restricted cash as of June 30, 2025 was $93.1 million.

As of September 30, 2025, we had cash, cash equivalents and restricted cash of $226.3 million.

Restricted cash as of September 30, 2025 was $79.2 million.

The net proceeds from our 2032 Notes, after the extinguishment and redemption of our Existing 2026 Notes, were $92.8 million.

The net proceeds of our $174.4 million New IPv4 Notes that we issued in April 2025 were $170.5 million of which

Page 49 of 58

$72.6 million was restricted.

This restricted cash will become available to us based upon improvements in our monthly leverage ratio and our debt service coverage ratio (as defined in the IPv4 Notes Indenture).

The net proceeds of our $174.4 million New IPv4 Notes that we issued in April 2025 were $170.5 million of which $72.6 was restricted.

This restricted cash becomes available to us based upon improvements in our monthly leverage ratio and our debt service coverage ratio (as defined in the IPv4 Notes Indenture).

During the three months ended September 30, 2025 the restriction on $14.1 million of restricted cash was released primarily due to an improvement in our monthly leverage and debt service coverage ratios under the IPv4 base Indenture.

We believe we are able to timely service our debt obligations and will not require any concessions to do so.

6 unchanged sentences

The following table sets forth our consolidated cash flows.

Six Months Ended June 30,

Nine months Ended September 30,

(in thousands)

3 unchanged sentences

Effect of exchange rates changes on cash

Net increase in cash and cash equivalents and restricted cash

Net Cash Provided by Operating Activities.

Net (decrease) increase in cash and cash equivalents and restricted cash

Net Cash Used in Operating Activities.

Our primary source of operating cash is receipts from our customers who are billed on a monthly basis for our services.

1 unchanged sentence

Our changes in cash provided by operating activities are primarily due to changes in our operating profit and changes in our interest payments.

We paid $48.0 million and $26.9 million of interest on our long-term debt obligations for the six months ended June 30, 2025 and 2024, respectively.

On the Closing Date, we entered into a TSA with the Seller, pursuant to which the Seller will provide to us, and we will provide to the Seller on an interim basis following the Closing Date, Transition Services to ensure an orderly transition following the separation of the Cogent Fiber Business from Sprint Communications.

We paid $55.0 million and $31.0 million of interest on our long-term debt obligations for the nine months ended September 30, 2025 and 2024, respectively.

On the Closing Date, we entered into a TSA with the Seller, pursuant to which the Seller will provide to us, and we will

Page 51 of 60

provide to the Seller on an interim basis following the Closing Date, Transition Services to ensure an orderly transition following the separation of the Cogent Fiber Business from Sprint Communications.

Amounts billed under the TSA are due 30 days from receipt of the related invoice.

During the six months ended June 30, 2025 and 2024, we were billed $0.4 million and $23.3 million as due to the Seller under the TSA, respectively.

During the six months ended June 30, 2025 and 2024, we paid $0.9 million and $88.2 million to the Seller under the TSA, respectively.

Amounts recorded and paid as due to the Seller under the TSA resulted in a use of cash in operating activities of $0.5 million for the six months ended June 30, 2025 and $64.6 million for the six months ended June 30, 2024.

During the nine months ended September 30, 2024, we were billed $26.3 million as due to the Seller under the TSA.

and we paid $91.9 million to the Seller under the TSA.

Amounts recorded and paid as due to the Seller under the TSA resulted in a use of cash in operating activities of $65.3 million for the nine months ended September 30, 2024.

Amounts billed and paid under the TSA for the nine months ended September 30, 2025 were immaterial.

Net Cash (Used in) Provided by Investing Activities.

Our primary use of cash for investing activities is for purchases of property and equipment.

Purchases of property and equipment were $114.3 million and $89.7 million for the six months ended June 30, 2025 and 2024, respectively.

Purchases of property and equipment were $150.5 million and $148.9 million for the nine months ended September 30, 2025 and 2024, respectively.

The changes in purchases of property and equipment were primarily due to the timing and scope of our network expansion and reconfiguration activities including geographic expansion, purchases related to our acquisition of the Cogent Fiber Business, costs associated with providing wave and optical transport services, conversion costs related to acquired data centers and adding buildings to our network.

Our primary source of investing cash is from payments under the IP Transit Services Agreement with TMUSA, pursuant to which TMUSA will pay us an aggregate of $700.0 million, consisting of (i) $350.0 million in equal monthly installments during the first year after the Closing Date and (ii) $350.0 million in equal monthly installments over the subsequent 42 months.

During the six months ended June 30, 2025 and 2024 we were paid $50.0 million and $154.2 million under the IP Transit Services Agreement, respectively.

Page 50 of 58

During the nine months ended September 30, 2025 and 2024 we were paid $75.0 million and $179.2 million under the IP Transit Services Agreement, respectively.

Net Cash Provided by Financing Activities.

1 unchanged sentence

Our primary sources of cash for financing activities are issuances of note obligations.

During the six months ended June 30, 2025 and 2024 we paid $98.7 million and $93.8 million for our quarterly dividend payments, respectively.

During the nine months ended September 30, 2025 and 2024 we paid $147.8 million and $141.0 million for our quarterly dividend payments, respectively.

Our quarterly dividends payments have increased due to increases in our quarterly dividend per share amounts.

Purchases of our common stock under our stock buyback program were $11.5 million and $8.0 million for the six months ended June 30, 2025 and 2024, respectively.

Principal payments under our finance lease obligations were $16.5 million and $42.1 million for the six months ended June 30, 2025 and 2024, respectively.

At the payment date, the present value of the IRU finance lease liability was $117.9 million and the remaining thirty-one $4.2 million monthly principal payments totaled $130.2 million.

Purchases of our common stock under our stock buyback program were $16.7 million and $8.0 million for the nine months ended September 30, 2025 and 2024, respectively.

Principal payments under our finance lease obligations were $25.3 million and $161.2 million for the nine months ended September 30, 2025 and 2024, respectively.

At the payment date, the present value of the IRU finance lease liability was $117.9 million and the remaining 31 monthly principal payments of $4.2 million totaled $130.2 million.

The prepayment resulted in a gain on lease termination of $3.3 million related to the difference between the book value and the cash payment.

Changes in our principal payments under our finance lease obligations were primarily due to the timing and extent of our network expansion and reconfiguration activities including geographic expansion, purchases related to our acquisition of the Cogent Fiber Business associated with providing wave and optical network services and adding buildings to our network.

We completed a series of debt issuances in the six months ended June 30, 2025.

We completed a series of debt issuances in the nine months ended September 30, 2025.

On April 11, 2025, we issued $174.4 million aggregate principal amount of 6.646% secured IPv4 address revenue notes, Series 2025-1 Class A-2 (collectively, the “New IPv4 Notes”), with an anticipated repayment date in April 2030, in an offering exempt from registration under the Securities Act.

The net proceeds of the New IPv4 Notes, after offering expenses were $170.4 million.

O which $72.6 million are restricted cash.

Certain of the restricted cash net proceeds will become available to us based upon improvements in our monthly leverage ratio and debt service coverage ratio (both as defined in the IPv4 Notes Indenture).

Interest on the New IPv4 Notes is paid on a monthly basis.

From and after the monthly payment date in April of 2030, principal payments will also be required to be made on the New IPv4 Notes on a monthly basis.

The net proceeds of the New IPv4 Notes, after offering expenses were $170.5 million, of which $72.6 million was restricted cash.

Certain of the restricted cash net proceeds becomes available to us based upon improvements in our monthly leverage ratio and debt service coverage ratio (both as defined in the IPv4 Notes Indenture).

During the three months ended September 30, 2025, $14.1 million of restricted cash became unrestricted primarily due to an improvement in our monthly leverage and debt service coverage ratios under the IPv4 Notes Indenture.

Interest on our New IPv4 Notes is paid monthly.

From and after the monthly payment date in April of 2030, principal payments will also be required to be made on our New IPv4 Notes monthly.

No principal payments will be due on the New IPv4 Notes prior to the monthly payment date in April of 2030, unless certain rapid amortization, mandatory prepayment or acceleration triggers are activated.

1 unchanged sentence

The net proceeds from the offering were $597.8 million after deducting offering expenses.

On June 4, 2025, we issued a notice of conditional full redemption to holders of all of our outstanding $500.0 million of our Existing 2026 Notes, specifying the 2032 Notes Closing Date as the redemption date.

On June 4, 2025, we issued a notice of conditional full redemption to holders of all of our outstanding $500.0

Page 52 of 60

million Existing 2026 Notes, specifying the 2032 Notes Closing Date as the redemption date.

On the 2032 Notes Closing Date, we used $507.3 million of the net proceeds from the offering to redeem in full, and satisfy and discharge our obligations under our Existing 2026 Notes.

3 unchanged sentences

● $2.2 million of accrued interest.

We completed a series of debt issuances in the six months ended June 30, 2024.

We completed a series of debt issuances in the nine months ended September 30, 2024.

On May 2, 2024, we issued $206.0 million of our Existing IPv4 Notes, with an anticipated repayment date in May 2029.

The net proceeds from the offering, after debt offering costs, were $198.4 million.

Interest on the Existing IPv4 Notes is paid on a monthly basis.

From and after the monthly payment date in May of 2029, principal payments will also be required to be made on the Existing IPv4 Notes on a monthly basis.

Interest on the Existing IPv4 Notes is paid monthly.

From and after the monthly payment date in May of 2029, principal payments will also be required to be made on the Existing IPv4 Notes monthly.

No principal payments will be due on the Existing IPv4 Notes prior to the monthly payment date in May of 2029, unless certain rapid amortization, mandatory prepayment or acceleration events occur.

3 unchanged sentences

The 2027 Mirror Notes bear interest at a rate of 7.00% per annum.

Interest began to accrue on the 2027 Mirror Notes on June 11, 2024 and will be paid semi-annually in arrears on June 15 and December 15 of each year, commencing on December 15, 2024.

Interest began to accrue on the 2027 Mirror Notes on June 11, 2024 and is paid semi-annually in arrears on June 15 and December 15 of each year, commencing on December 15, 2024.

Unless earlier redeemed or repurchased, the 2027 Mirror Notes will mature on June 15, 2027.

Page 51 of 58

Cash Position and Indebtedness

At June 30, 2025, our total indebtedness, at par, was $2.4 billion and our total cash, cash equivalents and restricted cash ($93.1 million) was $306.7 million.

Our total indebtedness at June 30, 2025 includes $605.2 million of finance lease obligations for dark fiber under long-term IRU agreements.

At September 30, 2025, our total indebtedness, at par, was $2.3 billion, and our total cash, cash equivalents and restricted cash ($79.2 million) was $226.3 million.

Our total indebtedness at September 30, 2025 includes $601.8 million of finance lease obligations for dark fiber under long-term IRU agreements.

Page 53 of 60

Summarized Financial Information of Holdings

2 unchanged sentences

Under the Indentures, we are required to disclose certain reasonably related information of Holdings and its subsidiaries that is not attributable to Group and its subsidiaries, relating to Holdings’ assets, liabilities and operating results (“Holdings Financial Information”).

The Holdings Financial Information as of and for the three and six months ended June 30, 2025 is detailed below (in thousands):

As of June 30, 2025

The Holdings Financial Information as of and for the three and nine months ended September 30, 2025 is detailed below (in thousands):

As of September 30, 2025

Cash and cash equivalents

21 unchanged sentences

Total liabilities and stockholders’ deficit

Page 52 of 58

Three Months Ended

June 30, 2025

September 30, 2025

Service revenue

9 unchanged sentences

Interest income and other, net

Six Months Ended

June 30, 2025

Page 54 of 60

Nine months Ended

September 30, 2025

Service revenue

11 unchanged sentences

Our Board of Directors has approved purchases of shares of our common stock under a buyback program (the “Buyback Program”).

In June 2024, we purchased 153,322 shares of our common stock for $8.0 million at an average share price of $51.97.

In the second quarter of 2025, we purchased 229,507 shares of our common stock for $11.5 million at an average price of $50.18 per share under the Buyback Program.

As of June 30, 2025, there was a total of $10.9 million available under the Buyback Program that was authorized to continue through December 31, 2025.

On August 6, 2025, our Board of Directors approved a $100.0 million increase to our Buyback Program to continue to December 31, 2026.

During the nine months ended September 30, 2025, we purchased 341,818 shares of our common stock for $16.7 million at an average price of $48.81 per share under the Buyback Program.

As of September 30, 2025, there was a total of $105.8 million available under our Buyback Program that is authorized to continue through December 31, 2026.

Dividends on Common Stock and Return of Capital Program

On August 6, 2025, our Board of Directors approved the payment of our quarterly dividend of $1.015 per common share.

This estimated $48.4 million dividend payment is expected to be made on September 5, 2025.

On November 5, 2025, our Board of Directors approved the payment of our quarterly dividend of $0.02 per common share.

This estimated $1.0 million dividend payment is expected to be made on December 8, 2025.

The payment of any future dividends and any other returns of capital, including stock buybacks, will be at the discretion of our Board of Directors and may be reduced, eliminated or increased and will be dependent upon our financial position, results of operations, available cash, cash flow, capital requirements, limitations under our debt indentures and other factors deemed relevant by our Board of Directors.

2 unchanged sentences

See Note 3 of our interim condensed consolidated financial statements for additional discussion of limitations on distributions.

Page 53 of 58

Future Capital Requirements

4 unchanged sentences

If issuing equity securities raises additional funds, substantial dilution to existing stockholders may result.

Page 55 of 60

We may need to, or elect to, refinance all or a portion of our indebtedness at or before maturity, and we cannot provide assurances that we will be able to refinance any such indebtedness on commercially reasonable terms or at all.

8 unchanged sentences

Critical Accounting Estimates

Management believes that as of June 30, 2025, there have been no material changes to our critical accounting policies and significant estimates from those listed in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the year ended December 31, 2024.

Management believes that as of September 30, 2025, there have been no material changes to our critical accounting policies and significant estimates from those listed in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the year ended December 31, 2024.

Page 56 of 60

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Management believes that as of June 30, 2025, there have been no material changes to our exposures to market risk from those disclosed in Item 7A “Quantitative and Qualitative Disclosures About Market Risk” of our annual report on Form 10-K for the year ended December 31, 2024.

Management believes that as of September 30, 2025, there have been no material changes to our exposures to market risk from those disclosed in Item 7A “Quantitative and Qualitative Disclosures About Market Risk” of our annual report on Form 10-K for the year ended December 31, 2024.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis