Nortel losses increase; 5,000 more jobs cut
Citing tighter capital markets and an overall economic slowdown, Nortel Networks Corp.'s losses grew to $2.58 billion for first-quarter from $730 million same time last year. It also will cut 5,000 more jobs by mid-year, for a total of 20,000 since Dec. 31.
Revenues were $6.18 billion for the quarter, down from $6.32 billion for the same period last year.
"As anticipated, we saw substantially lower sales in Optical Inter-city solutions," says President and CEO John Roth in a statement. "We saw slightly lower sales for our local Internet solutions, driven by a sharp reduction in circuit switching, which was nearly offset by considerable growth in our optical metro and core IP network solutions."
Lack of funding, service providers' high debt and the U.S. economic downturn will "continue to constrain capital spending by service providers," Roth says. That will change only with "a period of industry rationalization and an improved economic environment," he adds.
Nortel spokesman David Chamberlin told CEDaily that the job cuts weren't broken out by product or region, and that no facilities would close.
Given market uncertainties, Roth says, Nortel wouldn't speculate or provide guidance for its second-quarter or 2001 results.