Alcatel-Lucent is finally making the financial analyst community a bit happier, posting a profit for the first time since the combined company made its debut in 2006. And company CEO Ben Verwaayen is pointing to Long Term Evolution (LTE) technology as the fuel for the company's recovery long term.
As news of the company's $19.6 million net profit for the quarter came out, Alcatel-Lucent shares rose more than 9 percent. The company attributed these gains to the sale of satellite business and its stake in French defense contractor Thales SA. Alcatel-Lucent is now examining what other non-core assets it can sell.
Still, sales fell 4.8 percent from 2008 in the second quarter. Alcatel-Lucent's adjusted operating loss was $87.2 million compared with an operating profit of $131 million in 2008, while adjusted gross margin was 33.1 percent, a decrease of 34.9 percent from last year.
But Verwaayen made a pointed reference to LTE as a technology capable of fueling the company's recovery. "A lot is happening in LTE around the world, and not all of it is announced. We are extremely well positioned." Analysts interpreted that to mean the fast-pace of LTE deployments planned for the U.S.
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