Alcatel-Lucent posted higher profit in the fourth quarter of 2014 and vowed to continue its march into profitability in 2015. However, like its larger peer Ericsson, Alcatel-Lucent was stung in the fourth quarter by falling sales in North America, which is especially problematic since Alcatel-Lucent relies heavily on U.S. carriers for its overall sales.
Alcatel-Lucent's Shift Plan restructuring program may have peaked in terms of its effectiveness to deliver cost savings an analyst warned, as the company revealed fourth-quarter and full-year 2014 earnings that were below consensus estimates.
Alcatel-Lucent has set the next stage of CEO Michel Combes' Shift Plan with a focus on diversifying its customer base by selling more of its portfolio of edge and core routers to large enterprises and content providers.
Alcatel-Lucent has appointed Willem Hendrickx as president of its Europe, Middle East and Africa (EMEA) operations with effect from Jan. 1, 2015, replacing Luis Martinez Amago who will be taking up a new position at the equipment manufacturer to be announced in due course.
Alcatel-Lucent CEO Michel Combes said that the vendor is "back in the game" in terms of competing with its top rivals and that the company is looking, like other gear makers, for non-carriers customers. After skirting with financial disaster and undergoing a massive restructuring, Combes seemed to be brimming with confidence about Alcatel-Lucent's prospects.
Alcatel-Lucent has finalized the sale of its cybersecurity and security services business to Thales for an undisclosed amount, another move in its effort to shed non-core assets.
Alcatel-Lucent reported a narrower net loss for the third quarter and an improved margin as cost cuts and a slower cash burn offset falling sales. However, in the company's crucial U.S. market, sales continued to fall in the period.
Alcatel-Lucent appeared to address investors' concerns that its U.S. operation is too heavily reliant on large operators, with a deal to deploy an LTE overlay network for second-tier operator Pioneer Cellular.
Alcatel-Lucent's CEO said the company remains on track to reach its goal of becoming free cash flow positive by next year. And he said the company will be able to persist against its larger rivals like Ericsson and Huawei.
Alcatel-Lucent capped off the second quarter of 2014 with a narrower loss. Yet sales in the United States fell and investors have grown worried that the company's reliance on large contracts from U.S. carriers could hurt it if network activity drops.