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Electronics Production | October 31, 2007

Alcatel-Lucent to cut 4000 jobs

Alcatel-Lucent plans to cut an additionally 4000 employees until 2009 due to lower sales.
Most of the jobs that will be affected are in the US, due to weak orders for mobile equipment. Employees at Alcatel-Lucent in France will be relatively spared, CNN reported.

Alcatel-Lucent posted this morning it’s third quarter results. During the quarter, revenues grew sequentially by 2.3% at a constant Euro/USD exchange rateand gross margin improved sequentially to 34.2%. All of the company’s business segments grew sequentially in Q3 2007. Within the Carrier Segment, the optical network business saw strong double-digit growth, and the GSM business continued to gain traction due to a refreshed portfolio, registering a second consecutive quarter of double-digit revenue growth. For the quarter the company saw a 5.6% reduction in operating expenses on a comparable basis3 related to the third quarter 2006 and a 3.2% reduction sequentially. The company continues to execute on its integration plans and during the quarter reduced approximately 1,000 positions. Year-to-date the company has reduced headcount of 5,000 people before the impact of managed services and acquisitions (approximately 1,350 people). The company plans to achieve its synergy-related comparable3 pre-tax savings of Euro 600 million this year. As previously stated, savings accounted for in gross margin this year will not be retained due to current market conditions; however, the company does expect to retain most of its operating expense savings.

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