When the fourth quarter end on Sept. 30, Lucent Technologies Inc. expects to post a wider-than-expected loss of 45 cents a share. The news pummeled Lucent's stock, sending its shares down more than 11 percent in early trading.
Citing "continuing market softness and ongoing uncertainty in customer spending levels," the telecom gear giant is forecasting revenue will fall as much as 25 percent sequentially from the $2.95 billion it recorded in the third quarter. While analysts on average were expecting revenue of $2.89 billion, according to Thomson First Call, if Lucent's forecast is correct, the company will post revenue between $2.21 billion and $2.36 billion.
Adding to Lucent's woes, the company expects to record a loss of 45 cents per share, which is far steeper than the 16-cent per share loss analysts had estimated.
Lucent plans to reduce its quarterly revenue break-even rate to between $2.5 billion and $3 billion. The company says it is still targeting the end of fiscal 2003 as its time to return to profitability. In today's announcement, Lucent stated it will take "additional restructuring action," meaning more jobs will be eliminated. The company said it will provide an update on its headcount during its Oct. 23 earnings announcement. For the past two years, Lucent has made several reductions in its workforce while working to restructure its operations to better align expenses with demand. At the beginning of 2001, the company employed roughly 106,000 people, but that number has dwindled to around 50,000.
As of 11:38 a.m. EDT, Lucent shares were shedding 19 cents, or 11.5 percent of their value, trading at $1.46 a share.