Why Lumen Technologies Stock Surged 46.3% Last Year and Has Kept Climbing in 2026

Lumen (NYSE: LUMN) stock posted another year of big gains in 2025. The company's share price rocketed 46.3% higher across the stretch, according to data from S&P Global Market Intelligence.

Lumen's substantial stock gains came amid a 16.4% rally for the S&P 500 and a 20.4% gain for the Nasdaq Composite index. In addition to bullish momentum for the broader market, the company's valuation marched higher thanks to new partnerships and excitement surrounding its artificial intelligence (AI) network technologies.

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New deals spurred bullish momentum for Lumen in 2025

After surging 190% in 2024, Lumen stock actually traded down for much of last year. The valuation trend started to turn around in August after the company announced that it had signed a new network-as-a-service (NaaS) deal with the Pac-12 college athletics conference's broadcasting division. The news helped the stock recover from a post-earnings sell-off at the beginning of the month, and Lumen's share price saw significant gains in each of the next two months of trading.

The biggest pop for Lumen stock came in October and was triggered by news that the company had signed a new partnership with Palantir. The roughly $200 million deal involves the integration of Lumen Connectivity Fabric into Palantir's Foundry and Artificial Intelligence Platform (AIP) tech. Palantir is one of the biggest players in the AI software space, and the new contract significantly increased bullish sentiment surrounding the telecom-and-network-tech specialist's footing in the category.

The stock continued to march higher following the publication of the company's Q3 results at the end of October, but it retreated in November amid concerns that valuations for many AI stocks were in bubble territory. Sell-offs continued in December, but Lumen still managed to close out 2025's trading with big gains.

Lumen stock is off to a hot start in 2026

Lumen stock is bounding higher early in this year's trading. The company's share price is up roughly 8.8% in 2026 as of this writing. Meanwhile, the S&P 500 is up 1.4%, and the Nasdaq Composite is up 1.2%.

The tech specialist's valuation has continued to climb thanks to bullish momentum for AI stocks and indications that demand for hardware used to build artificial intelligence infrastructure remains strong. In particular, Taiwan Semiconductor Manufacturing's better-than-expected fourth quarter results helped boost the stock. TSMC's Q4 report showed that growth for AI semiconductors remains strong, and that's a positive demand indicator for Lumen's Private Connectivity Fabric (PCF) tech.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.