Earnings reports

Nortel Lowers Q1 Outlook

TORONTO -- Nortel Networks Corporation(a) (NYSE:NT)(TSE:NT.) today announced that its results for the first quarter of 2001 are anticipated to be below the Company's previously stated expectations. Nortel Networks now expects revenues in the range of US$6.1 billion to US$6.2 billion and a loss per share from operations (b) in the range of US$0.10 to US$0.12 for the quarter. This is below the Company's previous estimates of US$6.3 billion of revenue and loss per share from operations(b) of US$0.04 provided on February 15, 2001.

"We continue to feel the impact of the economic downturn in the United States and are now seeing customers globally assess its effect on their businesses," said John Roth, president and chief executive officer, Nortel Networks. "Reduced and/or deferred capital spending and increased pricing pressure are resulting in lower overall revenues, particularly in the United States."

Nortel Networks has made significant reductions in its employee base and adjusted its supply chain to reflect the current economic environment. The Company has substantially completed the employee related actions announced on February 15, 2001. The full benefit of these reductions is expected to impact the second quarter of 2001. However, due to the market environment, the Company is planning further reductions and now expects an aggregate net reduction, by mid year 2001, of approximately 15,000 from the number of employees at December 31, 2000. Nortel Networks expects to tightly adhere to its cost reduction and business realignment initiatives while driving further improvements in productivity and efficiency despite a difficult economic environment.

voyeur 12/4/2012 | 8:39:54 PM
re: Nortel Lowers Q1 Outlook Chambers et al had warned that visibility was murky at best, but Roth and company must be blind. First NT is confident that they can make their initial guidance, then they go from a decent profit to a loss, then they warn of wider losses (all within 2 months!!!). What is going on there?

Looks like their margins are shrinking and they just can't cut costs fast enough.

On another note, maybe JDSU shareholders should look into these issues, not to mention NT shareholders. JDSU looks like they got snookered when selling the Zurich plant to NT (to complete the SDL merger). Most of the purchase was financed in NT stock, which promptly took a nose dive. Of course, JDSU won't take NT to court since NT is such a big customer.

Maybe we should call Roth "Little Richie"$$$$$
allidia 12/4/2012 | 8:39:51 PM
re: Nortel Lowers Q1 Outlook CIENA? CORVIS? SYCAMORE? ???
hippo 12/4/2012 | 8:39:50 PM
re: Nortel Lowers Q1 Outlook I've said it when NT first came out and warned 2 months ago, "NT = NEXT LU!" Seems like they are heading down this path, no doubt in my mind!

I'm sure CSCO will be next. Just how soon.

I guess now it is more than obvious the big guys are having problem moving in a tight environment (reducing costs, increasing margin...). The smaller players like JDSU, CIEN, SCMR, etc are leaner and meaner, and can adapt to changes much quicker.

Another thing is these bigger companies employ a significant number of union people in the manufacturing side. I'm sorry to say it, but these union people work less than what was expected, and demand more than what they are worthed. And it is extrememly tough to get rid of them (legal issues, lock out...)

It is time for companies to seriously consider hiring *salaried* workers in the shop.
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