For anyone who’s been waiting for the other shoe to drop at Alcatel-Lucent, that thud you heard this morning was the head of CEO Patrica Russo getting the axe after the telecom supplier announced a humongous $1.7 billion second quarter loss. Joining Russo on the unemployment line is Chairman Serge Tchuruk who, together with Russo, orchestrated AlcaLu’s merger two years ago. Both say they’ll step down by year’s end.
The size of the loss—the sixth straight quarterly red ink since the merger—stunned analysts who had expected less painful news. The company said $1.27 billion of the loss was due to a write-down of AlcaLu’s North America CDMA technology business.
The company also is trimming its board, dumping former Lucent CEO Henry Schacht. News of the shakeup sent AlcaLu shares, which have plummeted more than 60 percent since last year, up 4 percent in European trading.
Alcatel-Lucent said revenue fell 5.2 percent from a year earlier, to $6.4 billion, but said adjusted operating profit of $146 million was better than expected. Analysts had predicted $100 million.
For more:
- See the New York Times story
- Or, the story in the Wall Street Journal
