Telecommunications giant Lucent Technologies, in a bid to recover from a string of disappointing earnings, said Wednesday it will cut 10,000 jobs in a bid to save more than $2 billion.
The job cuts, which represent nearly 8 percent of its 125,000 workers worldwide, were announced as the company
reported a $1.02 billion loss from continuing operations for its
first fiscal quarter.
The layoffs follow earnings shortfalls and a sharp decline in Lucent's stock price that drove the company,
once part of AT&T;, to fire its chairman and chief executive
Lucent said it will make the job cuts through layoffs and
attrition by July, and affected employees will be notified by
"With this announcement, we are outlining a comprehensive set
of actions to rebuild the company for long-term, sustainable
profitability," Henry Schacht, Lucent's chairman and chief
executive, said in a statement. "We are moving swiftly to
implement these actions companywide. They will serve as the
foundation for putting Lucent back on track."
The Murray Hill, N.J.-based maker of telecommunications gear said its
loss from continuing operations amounted to 30 cents a share in the
quarter ending Dec. 31. That fell below even the dismal
expectations of analysts surveyed by First Call/Thomson Financial,
who had forecast a loss of 27 cents per share.
A year ago Lucent had net income from continuing
operations of $1.08 billion, or 33 cents per share. Revenues fell
26 percent to $5.84 billion from $7.9 billion a year earlier.
The restructuring program excludes Lucent's Agere
microelectronics unit, which the company plans to spin off this
year. That unit has about 16,000 employees.
Lucent sells high-speed telecommunications equipment and
services to long-distance and regional telephone companies,
wireless and Internet service providers, and competitive local
Its once-dominant market position, as well as its credibility
with analysts, has fallen sharply as the company misjudged market trends and
lost business due to production and other problems. Those troubles
date back to late 1999, when Lucent first shocked analysts by
warning it would miss its earnings target.
The company's stock, once the most widely held in the country,
plunged about 80 percent in value from its high in December 1999.
The Associated Press contributed to this report