PARIS-Alcatel SA reported second-quarter net profits of $228.7 million, an 8-percent decline from last year’s $249.4 million. The profits came from sales of $4.3 billion, a 7.6-percent increase from last year’s revenues of $4 billion.
Though the company’s margins in its wireless network equipment are deteriorating, Alcatel said it was gaining ground in China with significant strength in wireless.
“With the industry consolidation gaining momentum, the wireless market environment becomes even more competitive as some players are aggressively trying to reposition themselves,” said Serge Tchuruk, Siemens chairman and chief executive officer. “In the context, we remained deliberately selective in addressing contract opportunities involving mature technologies. At the same time, we continued to invest in key future wireless technologies and applications to develop a leading position in next generation networks.”
Looking forward, Alcatel said it expects mid-single-digit range growth in the carrier markets during the third quarter as its operating margin remains steady.
Wall Street didn’t seem fazed by Alcatel’s earnings news as the company’s stock traded down slightly at $11.03 per share on the New York Stock Exchange immediately after the news.
