Tellabs Reverses 3Q Loss Caused By Write-Downs, Charges
DOW JONES NEWSWIRES
Tellabs Inc.'s (TLAB) reversed a prior-year third-quarter loss caused by
write-downs and restructuring charges, though growth in transport and services
revenue in the latest quarter was offset by lower broadband segment revenue.
While phone carriers plan significantly less capital spending this year, there
have been some signs that demand is stabilizing. Meanwhile, the global recession
is just the latest challenge for the telecom networking industry, on top of
increased competition from low-cost Asian rivals and weakening negotiating
leverage as the telecom sector consolidates.
Tellabs--a supplier of voice, data and video systems--reported a profit of $
29.3 million, or 7 cents a share, compared with a prior-year loss of $998.5
million or $2.51 per share. Earnings were 5 cents last year excluding the
charges. Revenue decreased 8.2% to $389.3 million.
Analysts polled by Thomson Reuters most recently forecast earnings of 6 cents
a share on revenue of $394 million.
Gross margin rose to 41.7% from 38.2% mostly on increased profitability of the
company's access products and stronger data-product revenue.
Broadband segment revenue dropped 21% and earnings were up 2.3%, despite data-
product sales rising 21%. Its transport segment saw a revenue increase of 17%,
boosting segment profit by 33%.
Looking ahead, Tellabs sees fourth-quarter revenue plus or minus 3% from the
third quarter's $389.3 million. Analysts are expecting $399 million.
Shares closed Friday at $6.66 and didn't trade premarket. The stock is up
nearly two-thirds this year.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com
(END) Dow Jones Newswires
10-26-090745ET
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