Tellabs' Q4 2011 losses drive more company layoffs

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Tellabs (Nasdaq: TLAB) continued to face revenue challenges in Q4 2011 as revenue declined on a year-over-year basis to $317 million from $410 million in Q4 2010.

Likewise, Tellabs' 2011 revenue declined year-over-year to $1.29 billion from $1.64 billion in 2010.

As a result, Tellabs CEO and President Rob Pullen said the company will lay off about 530 employees and refocus its efforts on wireless backhaul and packet optical networking segments. Additionally, it will stop development work on its SmartCore 9100 LTE product, while continuing to support its SmartCore 9100 WiMAX customers.

"We'll address customers' needs through our next-generation portfolio of products and services for the smart mobile Internet, including Tellabs Mobile Backhaul Solution, Tellabs Packet Optical Solution and professional services such as Tellabs Insight Analytics Services," Pullen said in a statement.

Earlier in Q2 2011, the vendor announced it would lay off 330 employees, or 10 percent of its workforce after reporting a 21 percent decline in year-over-year revenue from $423 million to $334 million.

Here's a breakdown of the company's key metrics:

  • Broadband/Data: Tellabs' Q4 2011 broadband segment revenue was $166 million. Ongoing revenue gains in managed access products was offset by lower data and access product revenue, while managed access revenue was $46.7 million, up from $37.5 million in Q4 2010.
  • Transport: Overall Q4 2011 transport segment revenue was $92 million. The ongoing declines in digital cross connect system revenue drove the segment profit down to $19.0 million.
  • Services: During the quarter, services segment revenues declined slightly from $60.2 to $59 million, a factor it attributes to lower deployment revenue, which was partially offset by higher professional services revenue. Meanwhile, the services segment profit rose to $20.9 million, up from $18.5 million in Q4 2010.

Looking forward, Tellabs forecast Q1 2012 revenue to fall between $260 million to $290 million, missing analyst estimates of $297.7 million.

For more:
- see the release (pdf)
- Reuters has this article

Special report: Wireline in the fourth quarter 2011

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