Nortel axes 7,000 jobs
Misses revenue target
Nortel is to axe a further 7,000 jobs amid warnings that it will once again miss its revenue target.The company blamed the job cuts on the depressed telco sector, and in particular, on further reductions in spending by service providers in the US.
But that will bring little comfort to those hit by this latest round of belt tightening by the telecoms equipment manufacturer. In Q2 Nortel reported revenues of $2.77bn and expected revenues for Q3 to remain "essentially flat".
Yesterday, it revised down its forecast warning that it would miss its revenue target by around 10 per cent.
The restructuring should be completed by the end of Q4, at which time Nortel will employ around 35,000, less than half the number of staff it had at the beginning of 2000.
This latest round of job cuts comes on top of the 3,000 redundancies announced in April.
Said Frank Dunn, Nortel president and chief exec: "We continue to see reductions in near term spending plans by service providers especially in the United States."
"...the market environment continues to be challenging with lower spending levels than previously expected and a more prolonged industry transition."
Nortel maintains it that will return to profitability by the end of June 2003. ®