In the just ended first quarter, Tellabs Inc. watched its profits continue to sink, and will be forced to cut another 1,200 jobs.
First-quarter net income plummeted 96 percent from $122.5 million, or 29 cents a share, in Q1 2001 to $5.3 million, or 1 cent a share. The company's Q1 2002 sales were $371.5 million, off 52 percent from the $772.1 million reported in Q1 2001.
Sales of broadband access solutions totaled $115 million. During the quarter, the company announced a Tellabs 8100 managed access system sale to Avantel, a Mexican telecommunications service provider, to introduce voice and data business services in 12 of Mexico's largest cities. Sales from optical networking totaled $181 million.
In addition to the workforce reductions, Tellabs will close a manufacturing facility in Ronkonkoma, N.Y., and consolidate several smaller locations. "Making the company smaller is painful, but it's essential to position Tellabs for a future return to growth," Chief Executive Richard Notebaert said in a statement. Before this latest round of cuts, Tellabs had reduced its staff by roughly 2,500. The company will take a $240 million charge in the second quarter related to restructuring and excess inventory. The actions, however, will reduce costs by $120 million during the rest of fiscal 2002.