CCOI · Cogent Communications Holdings, Inc.

Cogent Communications reported mixed financial results for the first quarter of 2026, characterized by a strategic shift in revenue mix and improved profitability metrics. Total service revenue declined 3.2% year-over-year to $239.2 million, primarily driven by a significant 17.0% drop in off-net revenue, which fell to $89.0 million. This decline was partially offset by strong growth in strategic growth areas. Wavelength revenue, a key expansion area following the Sprint network acquisition, surged 90.8% year-over-year to $13.6 million, with customer connections increasing by 71.2%. On-net revenue also demonstrated resilience, growing 4.6% year-over-year to $135.6 million, supported by a 24.8% increase in IPv4 address leasing revenue. Foreign exchange rates provided a $3.4 million tailwind to year-over-year comparisons; on a constant currency basis, service revenue would have decreased 4.6%. Profitability metrics showed notable improvement. GAAP gross margin expanded significantly to 23.4% from 13.6% in the prior year period, while Non-GAAP gross margin improved to 46.1%. Adjusted EBITDA increased 2.1% year-over-year to $70.2 million, resulting in an adjusted EBITDA margin of 29.3%, up from 27.8%. The company continues to receive $25.0 million quarterly payments under the IP Transit Services Agreement with T-Mobile USA. Net loss per share improved to $(0.83) from $(1.09) in the prior year. The Board of Directors maintained the quarterly dividend at $0.02 per share, payable in June 2026.