Alcatel-Lucent faces Q1 loss of €353 million

Alcatel-Lucent reported first-quarter revenues that rose by 0.6 per cent to €3.23 billion (US$4.23 billion), but dropped back into a loss of €353 million, compared to a profit of €259 million a year ago.

This included restructuring charges of €122 million and a financial loss of €152 million.

Gross margin came in at 29.4 per cent of revenue for the quarter, compared to 30.2 per cent in the year ago quarter and 30.4 per cent in the fourth quarter 2012. The year-over-year decline in gross margin mainly results from unfavourable product mix.

Alcatel-Lucent’s new CEO, Michel Combes, commented: "Alcatel-Lucent’s first quarter results reflect both encouraging trends in the marketplace and good progress with The Performance Program, for which discipline on execution remains the priority in 2013."

In terms of revenues, Networks & Platforms grew six per cent year-on-year with high single digit growth in IP and good traction in Wireless, Fixed networks, Platforms and Services, all partially offset by a double-digit decline in Optics.

Focused Businesses declined at a double-digit rate compared to the year ago quarter, with Enterprise at a mid-single digit rate and Submarine at a faster pace.

From a geographic standpoint, also adjusted for constant currency and compared to the year ago period, North America reached historical highs as a percentage of total revenues (48 per cent), resulting from strong growth in the region. While Japan showed good traction and China stabilised, the Asia Pacific region declined at a low single digit rate. Cautious spending persisted in Europe, which declined at a rate of 10 per cent. Rest of world declined at 10 per cent, where growth in Brazil was offset by weakness in the rest of Central and Latin America and Middle East and Africa.