Avaya Posts $37M Quarterly Loss
LINDA A. JOHNSON
Jul. 22, 2002
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TRENTON, N.J. (AP) _ Avaya Inc. reported its fourth straight quarterly loss and said it is cutting jobs and planning a big restructuring charge in the coming quarter.
Basking Ridge-based Avaya, which released its report after the stock market closed Monday, posted a loss of a $37 million, or 10 cents per share, in the quarter ending June 30. The company blamed the continued slump in spending on information technology.
Excluding a $9 million charge related to prior restructuring, Avaya's operating loss would have been $32 million, or 9 cents per share. Analysts surveyed by Thomson Financial/First Call had forecast a 4 cent a share loss.
Revenues for the quarter were down 29 percent, to $1.2 billion from $1.7 billion.
Avaya, a major provider of voice messaging systems and call center services, said it planned to take a charge of $150 million to $250 million in its fiscal fourth quarter.
The Lucent Technologies spinoff cut operating expenses by 27 percent in its third quarter and strengthened its balance sheet, but the reduced overhead wasn't enough to compensate for lower revenues, the company said.
``Therefore, we have begun taking actions to eliminate certain real estate holdings, reduce IT-related expenses and reduce headcount in some parts of our business,'' chief financial officer Garry McGuire said in a prepared statement.
The company said the moves are meant to increase liquidity and should help Avaya return to profitability, but gave no further details.
Shares of Avaya were down 10 cents, or 2.5 percent, to close at $3.80 in trading Monday on the New York Stock Exchange.
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