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Nortel reports $3.4 billion loss, cuts 1,300 jobs

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Woo boy, I guess I was a little more right than I thought about more bad economic news; this time it hits a little closer to home.

­Canadian telecommunications equipment manufacturer Nortel Networks has posted a loss of US$3.4 billion in Q3 2008, it’s largest loss in the past seven years. Revenue was down 14% year over year to US$2.32 billion and 1% year-to-date.

Commenting on the market dynamics, Nortel President and Chief Executive Officer Mike Zafirovski said: “In September, we signaled our view that a slowdown in the market was taking place. In the weeks since, we have seen worsening economic conditions, together with extreme volatility in the financial, foreign exchange and credit markets globally, further impacting the industry, Nortel and its customers. We are therefore taking further decisive actions in an environment of decreased visibility and customer spending levels.”

Nortel also announced plans to cut a further 1,300 jobs, on top of a previous round of cuts of 1,200 staff. About a quarter of the job cuts will occur this year, with the rest in 2009. None of the remaining staff will receive pay rises in 2009, unless already agreed. The cost savings are expected to reduce annual gross costs by approximately US$400 million in 2009.

|via CN|

Vodafone expected to announce job cuts

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­Considering the current state of the global economy, expect more news of this sad nature in the coming weeks. Carrier Vodafone is expected this week to announce a substantial job cut of its European workforce aimed at generating savings of £1 billion (US$1.6 billion). This news comes in addition to previous warnings from Vodafone that their sales have remained difficult in its UK and Spanish markets. Vodafone is expected Tuesday to post a half-year operating profit of £5.7 billion on sales of £19.8 billion.

“Whether they set a target now or in May, there will have to be a cost plan,” Terence Sinclair, telecoms analyst at Citigroup told the Sunday Times newspaper. “£1 billion is just 3% of sales.”

Hopefully big sales of the BlackBerry Storm 9500 following its launch on the 14th will help to save a few jobs for our European friends.

|via Sunday Times|

Stockstream Mobile allows you to watch your crashing stocks in real time

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Gary Krakow and TheStreet.com have a great video introducing Stockhouse’s newest BlackBerry application, Stockstream Mobile. You may remember Stockhouse for powering Reuters’ Connection-Station BlackBerry application. Stockstream Mobile retails for $19.95 and you can download it at the link below.

Stockstream Mobile for BlackBerry

|via The Street|

T-Mobile reports Q3 financial results

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T-Mobile Logo

Press Release

T-MOBILE USA REPORTS THIRD QUARTER 2008 RESULTS

T-Mobile USA, Inc. today reported third quarter 2008 results. At the end of the quarter, T-Mobile USA had 32.1 million customers, adding 670,000 net new customers during the third quarter, and OIBDA of $1.53 billion, up 8% compared to the third quarter of 2007.

“In the quarter, T-Mobile took giant steps forward in driving new innovations to meet the pressing needs of our customers,” said Robert Dotson, President and CEO, T-Mobile USA. “We introduced our customers to the T-Mobile @Home® landline replacement service at a time when saving money is a top priority for American households. We also established our new nationwide high-speed 3G services, which will cover 120 cities by the end of November. This network introduction was accompanied by the unveiling of the T-Mobile G1 with Google, the world’s first device built on the fully open Android operating platform giving consumers access to some of the most innovative mobile applications to ever come to market. These and other innovations are helping us aggressively compete as we debut new and craved-for services that truly meet customer needs and inspire greater long term loyalty to our brand.”

T-Mobile Q3 Financial Results

Seeking Alpha torn over RIM

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RIM logo

It might just be a sign of where the economy is, but financial website SeekingAlpha has published two thoughtful, well written articles saying two completely different things about RIM’s future. First up is SA analyst Bapcha, who says that RIM is currently the cheapest growth stock:

Research In Motion (RIMM), the manufacturer of the (Bl/Cr)ackBerry, turned in some exemplary numbers. For the three months ended Aug 30, 2008 (RIM’s Q2, 2009), revenue was $2.58 billion, up 15% from $2.24 billion in the previous quarter and up 88% from $1.37 billion in the same quarter of last year. The revenue breakdown for the quarter was approximately 82% for devices, 13% for service, 3% for software and 2% for other revenue.

During the quarter, RIM shipped approximately 6.1 million devices, and grew their subscriber base by 2.6 Million. Awesome numbers. In fact, for fiscal 2009 [ending Feb 2009], top-line growth of 80% and a growth of 70% in EPS is at the low end of what the company thinks they can churn out [awesome]. For fiscal 2010 [March 2009 to Feb 2010], I think that a growth in revenues of 40% yoy and EPS of 35% yoy [assuming slightly lower gross margins moving forward] are for sure numbers that RIMM can deliver on.

However, fellow SA analyst Matt Stewart has prepared five reasons why RIM will continue to fall.

Five reasons RIM will continue to fall

RIM stock outlook: the day after

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rim financial slide

If you’re a RIM shareholder right now, you probably feel as though you woke up on the wrong side of the bed this morning. RIM’s stock opened 20 points down on the Nasdaq from its close last night at $97.53, and is now hovering around $73 per share. Checking the latest financial news today, it’s clear that this fall is reflective of myriad issues, ranging from RIM’s low Q3 forecast to the general economic climate. Here’s the best reports we’ve seen so far on the issue.

MarketWatch: Research In Motion sinks on disappointing forecast

“RIM’s business model is starting to show its pressure points. The company has become increasingly dependent on hardware sales. As a result, the timing of new product launches can have a big impact on their results,” wrote Brian Modoff of Deutsche Bank in a report, in which he cut the stock to a sell rating. “We think this trend will only worsen and their numbers are now, more than ever, dependent on a steady stream of hit products.”

Yahoo! Finance: Premarket roundup: Research in Motion

Analysts were thoroughly divided Friday about the meaning of BlackBerry maker Research in Motion Ltd.’s latest financial report, while investors united in a rush to dump the stock.

More RIM Financial News