Tellabs Turns ProfitableTellabs Turns Profitable

NAPERVILLE, Ill. -- Tellabs today reported first-quarter 2004 revenue of $264 million, up 19% from $223 million in the first quarter of 2003.

Tellabs earned 3 cents per share or $13 million in the first quarter of 2004. Excluding restructuring charges of $7 million, Tellabs' non-GAAP earnings were 5 cents per share or $20 million. Stronger revenues, improved margins and lower expenses contributed to the company's first profitable quarter in two years.

"Tellabs is off to a good start in 2004, achieving our first profitable quarter in two years," said Krish A. Prabhu, Tellabs president and chief executive officer. "Looking forward, we see continued strength in our core products while making significant progress with our broadband data products, with nearly 30 customer trials in the works worldwide."

Transport -- Sales of transport systems, the company's core North American products, totaled $134 million, up 28% from $105 million in the first quarter of 2003. Tellabs continued its position as North American bandwidth management market leader, according to fourth-quarter 2003 data from industry analysts.

Managed Access -- Sales of managed access systems were $69 million, down 6% from $74 million in the first quarter of 2003.

Broadband Data -- Sales of broadband data products were $4 million. The company announced a new customer, PacketExchange, during the quarter. The company plans to introduce additional products in this category during 2004.

Voice Quality Enhancement -- Revenue from voice-quality enhancement and other systems amounted to $25 million, up 186% from $9 million in the first quarter of 2003, driven by demand for wireless as well as higher quality Voice over Internet Protocol (VoIP) telephony.

Services and Solutions -- Services and solutions revenue was $32 million, down 11% from $36 million in the first quarter of 2003, due to timing of hardware shipments.

Tellabs Inc.