Alcatel-Lucent ends difficult year with a loss: Revenues, losses increased during Q4

Alcatel-Lucent reported a loss of $3.74 billion during the fourth quarter, bringing its total loss to $5.1 billion for 2007. The company’s stock was down less than 4% to $6.02 on the news, however it has suffered a steady decline since it reached a high of $14.35 last July.
The company wrote down $4.3 billion against its 2006 merger between the two companies. Since the companies combined about 14 months ago, market valuation has lost more than $20 billion in value.
“This was the largest merger in our industry and it proved to be more difficult than expected,” CEO Patricia Russo said in a news conference, according to news reports. “I think the bulk of the things we had to sort out have been sorted out.”
Revenues reached $7.58 billion during the quarter, marking an 18% increase from the year-ago period. Annual revenues hit $25.79 billion, an increase of about 2.1% from 2006.
“As we have said, 2007 was a transition year for the company as we executed our integration plans in a difficult market environment. Notwithstanding these challenges, the performance of our wireline, enterprise and services business has been solid,” Russo said in a prepared statement.
“While the long-term prospects of our industry remain good, the macroeconomic environment has created uncertainty in our markets in the last few months.”
It’s been a tough year for Alcatel-Lucent. The company cut more than 5,000 jobs during 2007 and says about 4,000 more employees will be let go by the end of 2008. And Russo suffered speculation about her future at the company. But the company started 2008 on a positive note, scoring a five-year contract with U.S. Cellular Corp. to provide infrastructure for its CDMA network.