PARIS – Impacted by merger costs and writedowns, Telecommunications equipment provider Alcatel-Lucent reported a net loss of 336 million for the second quarter of 2007, compared to a profit of 302 million for the same period last year.
For the second quarter of 2007, Paris-based Alcatel-Lucent announced revenues of 4.33 billion, up 0.5 percent year-over year at constant Euro/USD exchange rate, or a 4-percent decrease at current rate.
Commenting on the quarterly sales, Alcatel-Lucent's CEO Patricia Russo declared: "This quarter, our revenues sequentially grew by a solid 13 percent at a constant Euro/USD exchange rate, with the strongest performance in the wireline and services businesses. From a regional perspective, we saw strong growth in Asia Pacific."
In the second quarter of 2007, the gross margin was 33.4 percent of sales, compared to 34 percent in the first quarter of 2007 and 38 percent in the second quarter of 2006.
According to Russo, this result was "lower than we would have liked and was negatively impacted by continued significant investments in key markets, an unfavorable product and geographic mix as well as some impact from product related transition costs as customers migrate their networks." She added that "the gross margin level this quarter is not indicative of the business going forward."
Alcatel-Lucent specified that the adjusted net loss of 336 million included a negative pre and post-tax impact of 298 million from a one-time impairment charge related to W-CDMA assets. The net loss exceeds expectations of a 147.1 million loss, based on a Reuters poll of 10 analysts.
Looking ahead, Russo said she anticipates sequential revenue growth as the year progresses, which implies a strong ramp-up in the second half 2007. For the full year 2007, she expects "revenues to increase on a percentage basis at the carrier market growth rate of mid single digits at a constant Euro/USD exchange rate.”