Alcatel-Lucent to cut additional 3,500 jobs amid growing losses

The recently merged Alcatel-Lucent announced plans to cut 3,500 jobs in addition to the 9,000 job cuts it previously announced. The French-American company also posted a loss of almost $800 million in its fourth quarter.
Interestingly, the company sought to give the bad news a slight spin with some financial exercises. The network vendor said that, if it adjusted its financial results as if the merger had been in place for a year, it would have posted a profit of $27 million. The merger of Alcatel and Lucent was finalized Dec. 1.
Alcatel-Lucent said the job cuts will save it $2.2 billion spread over the next three years, with at least $780 million to be saved this year. The company has yet to specify where the cuts will be made. Workers at the company have called for a strike on Feb. 15.
Alcatel-Lucent issued a profit warning in January, forecasting that it would break even in its fourth quarter. However, the challenges in developing a shared product line and riding through volatile market conditions in North America served to erode revenues, the company said.
“While the results for the fourth quarter are clearly disappointing, the positive long-term benefits of the merger and the growth potential of Alcatel-Lucent remain as envisioned,” CEO Patricia Russo said. “These are difficult but necessary decisions, and we will manage these reductions with care. We are committed to serving our customers’ needs, with a competitive cost structure and effective operating model.”
The company’s stock was down more than 3.5 percent on the news.