Lucent Technologies lowered its financial guidance for fiscal 2006, blaming lower sales in the U.S. and China. CEO Pat Russo called the slower performance a "temporary setback" and expects Lucent's performance to bounce back throughout 2006. UBS Investment Research said the weakness is predominately in the mobility segment because of potential cutbacks in Verizon Wireless capex in addition to a decline in sales of EV-DO equipment. Verizon has been aggressively rolling out EV-DO nationwide. Chinese carriers are waiting for third-generation build outs later this year, and UBS believes there was a possible slowdown in CDMA net additions with China Unicom. The second half is challenging, but Lucent should see some share gain at Cingular Wireless as it builds out WCDMA/HSDPA, said UBS.
For more about Lucent's lowered guidance:
- check out this article from Red Herring