Lucent beats earnings estimates, sales plunge

Tue, 10/22/2002 - 8:00pm
Susan Rush

Lucent Technologies Inc.'s ongoing attempt to reach break-even revenue of $2.5 billion per quarter led to another quarterly loss.

The telecom equipment giant posted a fourth quarter net loss of net loss of $2.81 billion, or 84 cents a share, compared to a net loss of $8.8 billion, or $2.59 a share, in the same quarter in 2001. On a pro forma basis, the company recorded a per-share loss of 64 cents, which beat analysts' previously reduced consensus estimates by a penny.

Revenue plummeted 56 percent from $5.16 billion a year ago to $2.28 billion.

Earlier this month, Lucent said it planned to lay off another 10,000 workers by the end of fiscal 2003. Once complete, Lucent will have a work force of 35,000. At its peak, Lucent had more than 100,000 employees.

Analysts have speculated that Lucent may run out of cash. Merrill Lynch analyst Tal Liani has forecast that the telecom giant could use up its entire $4.4 billion cash balance before the end of next year. Lucent denies that it is on the verge of running out of money.

The company is working toward its goal of achieving EPS break-even late in fiscal 2003 at $2.5 billion in quarterly revenue. "We will continue to improve the way we run the business by streamlining the processes we use with our customers and driving greater efficiency through improvements in supply chain and information systems," said Frank D'Amelio, Lucent's chief financial officer.

First-quarter revenue is expected to be flat or down 10 percent from the numbers posted in the fourth quarter. Analysts were expecting Lucent to post first-quarter revenue of $2.27 billion, according to Thomson First Call.


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