Thierry Breton, the former French Finance Minister and ex-CEO of France Telecom (FT), is being widely tipped as the leading candidate to take the helm of Alcatel-Lucent (AlcaLu) following the sudden resignation of the company's CEO and chairman--Patricia Russo and Serge Tchuruk respectively. While the company has been in desperate need of someone that can give the merged company some clear identity and strategy, the appointment of a Breton--a close member of the Parisian political establishment and French business elite, is not likely to be received warmly by the U.S. board members of AlcaLu.
However, while the company has recently lost around 60 per cent of its share value and reported a net loss of €1.1 billion for Q2 2008--its sixth successive quarterly loss, others believe the company might (just) be turning the corner. Buried within the financial data were reports that gross and operating margins, together with SG&A expenses and R&D costs, had all improved when compared with Q2 2007. Services revenues surprised most analysts with a 9.1 per cent year-on-year increase and up 20.4 per cent sequentially at €818 million in the second quarter.
Commenting prior to leaving the company, Russo said the company's strategy of "pursuing opportunities that had a balance of top line growth and profitability" was paying off, and that there was a backlog of services business on the books. The former CEO said AlcaLu was now the No. 2 player globally in the carrier services market.
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