Alcatel-Lucent's losses deepen as sales drop

Alcatel-Lucent saw third-quarter losses increase and sales drop compared to the same period last year, but the company still expects to break even for the full year, it said on Friday.

Third quarter revenue was €3.7 billion (US$5.5 billion), a 9.3 percent drop compared to the same period last year. The net loss increased to €182 million from €40 million a year earlier.

Alcatel expects the market for its products to shrink by between 8 percent and 12 percent this year, assuming constant exchange rates.

But there are some sunnier aspects of the report; service revenue grew 2.5 percent to €869 million, and revenue from applications software -- which includes everything from interactive IPTV solutions to subscriber data management -- grew 20 percent to €286 million.

The company also continues to make headway on its plan to cut annual running costs by €750 million. It has now managed to achieve 80 percent of that target, it reports.

Part of the company's planned turnaround is the roll-out of next-generation mobile broadband networks based on LTE (Long-Term Evolution).

France Télécom has selected Alcatel-Lucent for an LTE field trial South of Paris using FDD (Frequency Division Duplex) and TDD (Time Division Duplex) versions of the technology. The aim of the technical trial is to assess the end-to-end performance of LTE. To date, the company's LTE products have been selected by 16 operators for trials, it said, with Etisalat and Telefónica the latest additions to the list.

The IDG News Service is a Network World affiliate.