Nortel revenues fall again

In its quest to return to profitability, Nortel Networks (www.nortelnetworks.com) logged yet another problematic quarter. In its third quarter, Nortel reported a net loss of $1.8 billion, or $0.42 per share. Yet when compared to last year’s $3.47 billion net loss, things don’t look quite so bad.

Revenues for the quarter were $2.36 billion, compared to $3.69 billion for the year ago quarter. As of the end of the quarter, Nortel had a cash balance of approximately $4.59 billion. As a result the company expects $1.5 billion in un-drawn credit facilities to expire in mid-December.

“Our top priority remains returning to profitability,” said Frank Dunn, president and CEO of Nortel. “And we are making progress on that,” he said.

Dunn expects the company to reach breakeven when it hits $2.4 billion in revenue per quarter. But Dunn also believes the current capex crunch will continue well into 2003.

Nortel remains focused on the areas of wireless, wireline and enterprise equipment, according to Dunn, but that in no way assures the current product line will stay intact.

“I think people have to make decisions,” Dunn said. “You have to look at businesses that don’t perform and take corrective action,” said Dunn.