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

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|

5 Responses to “Nortel reports $3.4 billion loss, cuts 1,300 jobs”

  1. 1 Simon

    So, uh, what does this have to do with BlackBerry?

  2. 2 BlackBerry Cool

    Nortel helps supply the infrastructure that you use your BlackBerry on. The fact that they’re in trouble is not only news to people within the wireless industry, but also people that use their BlackBerry on said wirless infrastructure. We’re also in a global recession, and news of Nortel’s shortcomings helps indicate how this is affecting the wireless industry.

    Do you want me to continue?

  3. 3 Kyle

    Nortel is no longer much of a player in the wireless industry.

    In 2006, Nortel sold its Universal Mobile Telecommunications System (UMTS) to Alcatel-Lucent for $320 million.

  4. 4 BlackBerry Cool

    Here’s the link to Nortel’s products page:

    You might notice some words there that apply to the wireless industry and the infrastructure BlackBerrys need to run…

    * Base Station Controllers
    * Base Transceiver Stations
    * EDGE
    * 1xEV-DO

    No wonder one of you works for our mobile entertainment site and the other now works for another blog. =D

  5. 5 LouTreize

    …and RIM had a joint initiative with Nortel to get IP Telephony on BES.

    Nortel has played a big roll in the wireless industry that we have today. Not only that but this is just one of the few CANADIAN Fortune 500 companies breathing. Regardless if they’re breathing sh*t, they’re still Canadian. Any news about Nortel, as annoying as it can be, should remind people about the failed industrial policies that took it down in the first place.

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