Tellabs Cutting 10% of Staff
The restructuring program is expected to be completed by the end of the second quarter of 2012, but there are no further details on which parts of the company will be affected.
The news came as Tellabs reported a 21 percent year-on-year decline in second-quarter revenues to $334 million and a net loss of $20 million, compared with a net profit of $64 million a year ago, showing just how tough the North American transport infrastructure market is right now.
The vendor noted that its revenues from North America fell by 46 percent, while sales from overseas markets actually increased by 70 percent compared with a year ago. The trouble is, Tellabs is still very heavily reliant on the former market.
The news won't come as a major surprise to those who follow the company closely. It had an equally poor first quarter following a warning in January of troubles ahead. As a result, analysts, on average, had predicted second-quarter revenues of $336.9 million and a non-GAAP (after one-time costs) loss of 3 cents, slightly worse than the reported second-quarter non-GAAP loss of 2 cents per share. However, a year ago the vendor reported non-GAAP earnings of 17 cents per share. (See Tellabs Reports Q1 and Tellabs Tanks in Q4.)
The company's gross margins have also crashed, down to 37.4 percent from 53.5 percent a year ago.
Although third-quarter revenues are usually lower than the second quarter, Tellabs expects revenues for the current three-month period to be between $325 million and $345 million. However, analysts had expected revenues of $349.6 million for the third quarter.
The company's share price stood at $4.19 before the markets opened Tuesday.
— Ray Le Maistre, International Managing Editor, Light Reading