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Alcatel-Lucent to Cut 5,000 Jobs As It Drops Back into Quarterly Losses
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Alcatel-Lucent has announced that it is cutting a further 5,000 jobs after it reported a 7.1% drop in its second-quarter revenues of EUR3.55 billion (US$4.3 billion).
The networks division witnessed a double-digit decline this quarter compared to the year ago period. The high single digit growth rate in IP business was more than offset by the double digit declines in both Wireless, resulting from a higher comparison base and moderate or delayed spending from service providers, and Optics.
The company also dropped back into a quarterly loss, of EUR254 million (US$307 million), compared to a profit of EUR43 million a year ago.
Commenting on the results, Ben Verwaayen, CEO Alcatel-Lucent, said: "despite having demonstrated our ability to deliver operational profitability, it is clear from the deteriorating macro environment and the competitive pricing environment in certain regions challenging profitability that we must embark on a more aggressive transformation."
The company is aiming to cut costs by EUR1.25 billion by the end of next year, an increase of EUR750 million on the previous projections.
The company also said that it will start to market its patent portfolio as an independent profit center.
Tags: [alcatel-lucent]
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