Will Alcatel-Lucent Turn Its Fortunes Around?

Alcatel-Lucent (ALU) is plotting its turnaround once again. It recently announced a management reshuffling as part of its previously planned cost-cutting measures. The company said that it will shift from its regional operating structure to global relevance in terms of business segments. The new structure will be composed of global products and operating business units: Core Networks, Fixed Networks, Wireless, and Platforms.

With this setup, Chief Financial Officer Paul Tufano is expected to take on the role of COO, while Robert Vrij will head up the Global Sales and Marketing Division. The result is a streamlined and dynamic management team that will address issues as soon as they arise. Even its executive committee has six fewer members compared to the 12 it used to have.

Recall how Alcatel-Lucent performed in the second quarter of this year. It reported revenue of 3.82 billion euros, down by 7.1% year on year. But this is up by 10.6% on a quarter-on-quarter basis. Revenue from the wireless business amounted to 877 million euros, an increase of 11.3% from the previous quarter. This is down by 18.7% compared to the same period last year. The decline in wireless revenue is due to delayed spending of service providers on 2G and 3G technologies. Despite this news, the company’s LTE business experienced a threefold increase in revenue. In terms of geography, North America and Europe posted year-on-year declines of 8.3% and 15.6%, respectively. All geographies were up on a quarter-on-quarter basis. To continue reading, click here.

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