Feeds

3Com takes $19m hit on stuffed Euro inventories

An extra 1,000 staff get the bullet

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

3Com is canning 1,000 more staffers than it thought it would when it launched its restructuring plans last year. So its Q1 losses have quadrupled but the cost cutting is going well.

The total job cull is going to be 6,000 since November 2000, half of its workforce.

For the quarter ended 31 August 3Com said its loss widened to $132 million, excluding one off charges, from a pro forma loss of $41.3 million in the quarter a year earlier.

Including job cutting and other restructuring charges - like leaving the fledgling Internet appliance business and the consumer broadband-modem business, and taking a $19 million hit on European inventory problems - the loss was $232.4 million compared with $59.2 million a year earlier.

3Com Q1 sales fell to $390 million - they'd been $468 million in the previous quarter and $933.7 million in Q1 a year earlier.

Bruce Claflin, 3Com presidente and CEO, said: "3Com made solid progress during the first quarter of its fiscal year. It finished ahead of plan for expense reductions and cash. 3Com demonstrated meaningful margin improvement, and while revenue was below plan, there were some encouraging signs."

3COM's CommWorks, the unit that targets the telecom sector matched the previous quarter by generating $59.4 million dollars in revenue.

The Business Networks Company, which serves the enterprise market, generated $195 million of revenue. This missed internal targets but the stackable product line grew 18% sequentially, led by interest in recently announced Gigabit Ethernet products.

3Com's business connectivity company, which sells access products such as PC Cards and NICs to PC OEMs and enterprise customers, suffered because of reduced average selling prices, and inventory issues. In the past quarter 3Com reduced the unit's channel inventories by approximately $25 million, most of which was in Europe, and also took extraordinary charges of close to $19 million associated with the elimination of surplus inventories. ®

Website security in corporate America

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Murdoch to Europe: Inflict MORE PAIN on Google, please
'Platform for piracy' must be punished, or it'll kill us in FIVE YEARS
Bono: Apple will sort out monetising music where the labels failed
Remastered so hard it would be difficult or impossible to master it again
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Sony says year's losses will be FOUR TIMES DEEPER than thought
Losses of more than $2 BILLION loom over troubled Japanese corp
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.