Alcatel-Lucent Maintains Outlook

Next Generation Communications Blog

Alcatel-Lucent Maintains Outlook

Earlier this week, Alcatel-Lucent announced its Q1 earnings, which showed a reduction in first-quarter revenue, and a slightly lower gross margin on revenue. While not entirely unexpected, the results caused shares in the Franco-American telecoms gear maker to sink on the news.
 
Still, Alcatel-Lucent CEO Ben Verwaayen, maintained a positive keel, pointing to recent wins in 3G and LTE and increased business from the Asia-Pacific and North American markets.
 
"This quarter was about putting together the new Alcatel-Lucent. I am pleased with the customer response to our new direction and strategy", he said. "As we discussed before, 2009 will be a year of transition."
 
"While expected, given seasonality and tough market conditions, we are not pleased with the operating loss incurred in the first quarter," Verwaayen added. "Our guidance for the year remains unchanged and we are taking appropriate actions".
 
 
In December, when Verwaayen announced the company's strategic plan, he told analysts that Alcatel-Lucent expected the market for global telecom equipment and related services would be down between 8-12 percent. He also announced that the company anticipated an adjusted operating profit around break-even in 2009.
 
That remains unchanged.
 
With regard to the plan to simplify the organization structure and eliminate 1,000 management positions and 5,500 contractors, the company announced that 290 managers have been cut and the number of contractors has been reduced by 770.
 
Alcatel-Lucent continues to pursue its "high leverage network" strategy, which is designed to enable its carrier customers to deliver and manage advanced applications, compelling content and personalized services to residential, business and mobile users.
 
The company also announced the imminent sale of its stake in aerospace and security information systems provider Thales to Dassault Aviation for Euro 1.6 billion.
 


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