All famous. All losers.
Now, a good chunk of the telecom industry's biggest names have joined the loser club, thanks to their ability to ooze red ink from every pore during the telecom recession.
Fortune magazine memorializes the failure of said companies in a list of the global firms with the largest corporate losses.
Nortel Networks Corp. (NYSE/Toronto: NT) is 2001's biggest loser, with $27.3 billion in losses for the fiscal year that ended March 31, 2002, according to Fortune. Lucent Technologies Inc. (NYSE: LU) came in two notches below Nortel, with $16.1 billion in losses.
The list was made with data from Fortune's Global 500 for 2002 list, which it published in late July. The 25-company list gives grim reassurance that the telecom sector is leading the world's economic doldrums.
Save Ford Motor Co., State Farm Insurance, and a handful of banks, the list was dominated by telecom equipment vendors, service providers, and other companies with heavy telecom and Internet components, such as AOL Time Warner Inc. (NYSE: AOL).
Table 1: Telecom's Biggest Losers
|Global 500 Ranking||Company||Loss ($M)|
|16||Nippon Telegraph & Telephone||6,496|
|98||AOL Time Warner||4,921|
|Source: Fortune magazine|
Other equipment vendors among the top 25 money losers include Alcatel SA (NYSE: ALA; Paris: CGEP:PA), with more than $4 billion in red ink, and Motorola, $3.9 billion in the hole.
The top money losing service providers are Vodafone Group plc (NYSE: VOD), France Telecom SA, KPN Telecom, Nippon Telegraph and Telephone Corp., and Deutsche Telekom AG (NYSE: DT). The only U.S. service provider on the loser list is Qwest Communications International Inc. (NYSE: Q), which lost more than $4 billion in 2001 and lost money in 2000 as well.
One company that may yet make the list: WorldCom Inc. (OTC: WCOEQ), which has yet to restate its real 2001 earnings after falsely accounting for at least $7.1 billion in expenses.
In all, the worst performers of the telecom space lost some $107.6 billion in 2001 -- and that's not counting the sundry Japanese conglomerates, such as Hitachi, Fujitsu, and NEC, which have scores of other businesses that aren't related to communications. Put another way, that set of companies lost roughly the combined gross domestic product of Costa Rica, Cuba, and New Zealand.
— Phil Harvey, Senior Editor, Light Reading