Analyst Lowers Q4 View for AlcaLu
He believes European operators and Verizon Communications Inc. (NYSE: VZ) have reined in their spending during the fourth quarter, and that some network projects in China have been delayed, leaving AlcaLu with lower than expected sales for the final three months of 2009. The "bulk of the declines are in the Wireline, Optics, Enterprise and Services categories," he notes.
Genovese has lowered his revenues forecast for the vendor's fourth quarter to €4.17 billion ($6 billion) from his previous forecast of €4.39 billion ($6.32 billion), and expects earnings pre-share of $0.06, down from $0.10. On average, analysts are expecting revenues of €4.48 billion ($6.45 billion).
The Soleil man also expects AlcaLu to miss its target of adjusted operating break even for the full year: He forecasts a €143 million ($206 million) adjusted operating loss for 2009.
But the analyst sees this as a temporary setback only. He expects AlcaLu to gain market share in the IP router, mobile infrastructure, and packet/optical equipment sectors in the long term. (See AlcaLu Makes Its Packet-Optical Move and AlcaLu Scores Core 100G Win.)
In fact, he believes AlcaLu has had an impressive year in the IP router market, and expects the company to have increased its market share for 2009 to around 20 percent, from about 15 percent in 2008, at the expense of Cisco Systems Inc. (Nasdaq: CSCO) and Juniper Networks Inc. (NYSE: JNPR). (See AlcaLu Readies 100GigE Cards and AlcaLu Has the Edge in EMEA.)
With the exception of Huawei Technologies Co. Ltd. , which says it's still growing, 2009 has been a tough year for the major telecom infrastructure vendors. However, AlcaLu's CEO, Ben Verwaayen, is expecting improvements in 2010 and 2011 as the company continues to promote its applications-centric vision. (See AlcaLu Shows Off Its Apps Abs, AlcaLu Reports Q3, AlcaLu CEO Pitches Recovery Story, Asset Sale Helps AlcaLu to Q2 Profit, Hard Times for Alcatel-Lucent, and Huawei Predicts 29% Growth in 2009.)
— Ray Le Maistre, International News Editor, Light Reading