Telco spending will flatline in 2008

Alcatel-Lucent dials down forecast

Dollar

The global telecoms market is facing a chilly 2008 if Alcatel-Lucent’s latest financial forecast proves to be on the mark.

Alcatel-Lucent forecast the telecoms and related services market this year will be "flat versus the company’s previous forecast of flat to slightly up". Alcatel-Lucent's own full year revenues, at constant currency rates, will be down in the low to mid single digits, mainly because of the declining dollar and spending collywobbles at a few big customers.

The glum outlook came as it revealed revenues down 0.5 per cent for the first quarter ending 31 March to €3.9bn. It made a net loss of €181m compared to a loss of €95m a year ago.

On an adjusted basis – ie, excluding trivialities like amortisation and depreciation – things were a little sunnier, in the shape of a mere €95m loss, compared to a €199m profit a year ago.

If dealing with an uncertain market wasn’t bad enough, the firm’s figures were hit by the slide in the dollar against the euro. If the dollar hadn’t been so sickly, its revenues would have been up 6.3 per cent.

The carrier business took the hardest hit, with revenues sliding 4.9 per cent to €2.7bn, and turning in an operating loss of €34m. The enterprise and servives businesses both saw revenues up and turned in operating profits. ®

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