Alcatel-Lucent posts Q4 net profit, readies sale of enterprise unit

The company's restructuring plan Shift is on track, it said

Alcatel-Lucent's revenue remained flat, but the company turned a year-earlier loss into a net profit for the fourth quarter.

The company has also found a buyer for its enterprise networking unit, it said.

Sales for the quarter totalled €3.93 billion ($US5.41 billion as of December 31, the last day of the period reported), down 0.1 per cent year-on-year. The company made a net profit of €134 million, up from a €1.56 billion loss during the year-earlier quarter.

Wireless access, which includes LTE networks, was the best performing product category. Revenue from fixed access and IP transport products also increased, while managed services and IP routing segments struggled.

The net profit is good news for Alcatel-Lucent CEO, Michel Combes, who joined the company in February last year with the intention of turning around a company that has been struggling for a number of years.

However, the company and Combes still have a lot of work do to. The fourth-quarter profit stands in stark contrast with Alcatel-Lucent's performance for the full year, for which it reported a €1.3 billion net loss. But that is a step in the right direction compared to the €2.01 billion loss it reported during 2012.

The improvements are a result of Alcatel-Lucent's Shift plan, which was announced at the beginning of October and is on track, the company said. According to the plan, Alcatel-Lucent will cut 15,000 jobs over the next two years, and create 5,000 others as it seeks to focus on sales of IP networking and broadband equipment for fixed and wireless access networks.

Part of the plan is also to shed some units that don't fit with that focus, including the Enterprise unit, which makes IP telephony and Ethernet switching equipment. It has received a binding offer for that from technology investment company China Huaxin, valuing the unit at €268 million. Alcatel-Lucent plans to retain a 15 percent minority interest, it said.

Alcatel-Lucent will shortly submit the proposed transaction to the Enterprise unit's workers councils for the required information and consultation procedures. It expects to sign a definitive agreement during the second quarter, and the deal will then close during the third quarter if all goes according to plan.

Tags business issuesalcatel-lucenttelecommunicationfinancial resultsMergers and acquisitionsrestructuring

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Mikael Ricknäs

IDG News Service

Comments

Comments are now closed.

Most Popular Reviews

Follow Us

GGG Evaluation Team

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Steph Mundell

LIFEBOOK UH574

The Fujitsu LifeBook UH574 allowed for great mobility without being obnoxiously heavy or clunky. Its twelve hours of battery life did not disappoint.

Andrew Mitsi

STYLISTIC Q702

The screen was particularly good. It is bright and visible from most angles, however heat is an issue, particularly around the Windows button on the front, and on the back where the battery housing is located.

Simon Harriott

STYLISTIC Q702

My first impression after unboxing the Q702 is that it is a nice looking unit. Styling is somewhat minimalist but very effective. The tablet part, once detached, has a nice weight, and no buttons or switches are located in awkward or intrusive positions.

Latest News Articles

Resources

Best Deals on GoodGearGuide

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?