Lucent Technologies has revised profit estimates downwards for its fiscal 2000 fourth quarter from $US0.24 per share to between $US0.17 and $US0.18 per share, the company announced in a statement Tuesday.
On the news, Lucent shares were hammered on the New York Stock Exchange, losing $US7.13, or 22.7 per cent, in daytime and after-hours trading to end at $US24.25, according to online marketplace Island ECN.
Revenue for the quarter, which ended Sept. 30, will be in line with previous estimates at between $US9.3 billion and $US9.4 billion, Lucent said.
Lucent said that three factors were equally to blame for the lower-than-expected earnings: lower than expected revenues and gross margins in the company's optical systems business; credit concerns in the emerging service-provider market that led to increasing reserves for bad debt, and a greater than anticipated decline in circuit-switching sales and margins.
For fiscal 2000, Lucent expects overall profit to be 10 per cent to 11 per cent lower than in 1999, on revenue approximately 14 per cent higher.
Lucent said that its fourth-quarter results "will impact and lower its guidance for fiscal year 2001."
According to Jeffrey Kagan, an independent telecommunications analyst based in Atlanta, Lucent had been so successful selling telecom networking equipment that it missed the signs of how quickly the demand was shifting to data and optical networking equipment.
A comeback -- including rebuilding the company's image and gearing up to meet the demand for new data networking equipment -- may take Lucent a few years, Kagan said in an e-mail response to the Lucent statement.
Lucent shares finished the day down 94 cents at $US31.38 on the New York Stock Exchange.