Wednesday, November 3, 2010

Alcatel-Lucent Sees Performance Driven by IP and Wireless

Alcatel-Lucent reported Q3 2010 revenue of Euro 4.074 billion, up 10.5% year-over-year, up 6.8% sequentially. Net income was Euro 25 million or Euro 0.01 per diluted share (USD 0.02 per ADS).

The company said its financial performance was driven by an acceleration of growth in IP and wireless, partly offset by a decline in wireline networks. Terrestrial optics revenues were almost stable this quarter. Applications revenues were stable both for Networks applications and Enterprise applications. Services revenues grew at a low single digit rate with good performance this quarter for Managed & Outsourcing solutions.

From a geographic standpoint, traction remained strong in North America with a double digit rate of growth and sales trends improved in all other regions of the world, especially with Asia Pacific and Eastern Europe growing at mid single digit rates. Specifically, growth in India and Russia was significant, and resumed in China this quarter.

Alcatel-Lucent said its supply chain is still experiencing capacity constraints as the demand for telecommunications equipment and related services is recovering due to booming data traffic.

"I am pleased with the good progress made in our transformation journey, highlighted with healthy sales and improved profitability this quarter. Our solutions are recording strong traction with our customers as evidenced by a book to bill ratio up from the year ago period, and a growing share of our next generation product sales. From a geographic standpoint, on top of the established strong dynamic in North America, we experienced good growth in India, China and Russia fuelled by our recent contracts wins and better market conditions. We improved our overall profitability sequentially and year over year even though our product and geographic mix was less favourable than in the second quarter of 2010," commented Ben Verwaayen, Alcatel-Lucent CEO.