Avaya losses widen as revenue sinks

Avaya reported revenue for the quarter of US$1.15 billion, down 20 percent from revenue of US$1.44 billion the same quarter a year ago.

Excluding one-time charges of US$467 million, Avaya reported a loss of US$67 million, or 18 cents per share.

Financial analysts expected Avaya to report an earnings loss of 6 cents on revenue of US$1.16 billion, according to Thomson First Call.

"Enterprise spending on IT in general and on communications products and services in particular continue to be constrained," said Don Peterson, chairman and CEO of Avaya, during a conference call. "It's clear that our customers are focused on holding down their cost and their capital expenditures until they see an upturn in their own sales and profitability," he said.

For fiscal 2002, Avaya reported a loss of US$656 million, or US$2.41 per share, compared to a loss of US$352 million, or US$1.33 per share, in fiscal 2001.

Revenue for the year dipped to US$4.96 billion, down from US$6.79 billion the previous year.

Avaya continues to search for a buyer for its connectivity solutions unit, a non-core business, but has yet to receive a fair-value offer in the current economic climate, Peterson said, conceding that the company might not find a suitable offer in the near-term.