Alcatel-Lucent 3rd-Quarter Losses Widen
Published on: 30th Oct 2009
Note -- this news article is more than a year old.
Alcatel Lucent has reported a larger than expected third quarter loss on lower sales. The company lost EUR182 million (USD270 million), compared to EUR40 million a year ago. That was worse than the EUR 174.4 million average loss from eight estimates compiled by Bloomberg.
Revenues were down by 9.3% year-over-year and 5.6% sequentially to EUR3.69 billion. At constant currency exchange rates, revenue decreased 11% year-over-year and 3.5% sequentially.
Ben Verwaayen, CEO, commented: "We have achieved significant operational progress. We are rapidly reshaping our cost and expense structure, having achieved 80% of our Euro 750 million target in annualized savings year to date. We generated Euro 362 million in free cash flow this quarter by improving our operating working capital metrics. Finally, robust investor reception to our Euro 1 billion convertible bond offering allowed us to further strengthen the balance sheet."
The carrier segment saw a double-digit decline in revenue, driven by 2G wireless access, TDM switching and terrestrial optics. The segment did see moderate growth in fixed broadband access, good growth in IP and strong growth in submarine optics, fixed NGN/IMS and W-CDMA. Enterprise revenue continued to decline at a double-digit rate. Applications software revenues grew at a strong double-digit rate and finally Services revenues grew at a low single-digit rate.
From a geographic standpoint and in local currencies, revenue declined at a double-digit rate in both Europe (-13%) and in the rest of the world (-32%). On the other hand, revenue declined slightly in Asia Pacific (-1%). Finally, North America returned to moderate growth this quarter (+1%).
Alcatel-Lucent reiterates its guidance for 2009. The company continues to expect the global telecommunications equipment and related services market to be down between 8% and 12% at constant currency in 2009. The company still anticipates an adjusted operating income around break-even in 2009.