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 Technology Stocks | Alcatel-Lucent (ALU)


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From: Sam2/10/2012 11:44:16 AM
   of 172
 
This article has more details than Savitz's piece does. It also includes a note saying that Alcatel is belatedly working on trying to monetize their patent portfolio. About time!

Alcatel-Lucent returns to profit in 2011
Telecoms gear maker Alcatel-Lucent turns in first annual profit since 2006 merger
By Greg Keller, AP Business Writer | Associated Press
finance.yahoo.com

PARIS (AP) -- Telecommunications equipment maker Alcatel-Lucent said Friday that years of cost-cutting helped it make an annual profit in 2011, its first since its trans-Atlantic merger in 2006.

The Paris-based company reported a net profit of euro1.1 billion ($1.46 billion) in 2011, compared with a net loss of euro334 million in 2010.

Alcatel-Lucent shares rose as much as 23 percent to their highest level in three months as investors applauded the group's return to profit as well as a new plan aimed at turning its patent portfolio into a money-spinner for the high-tech company.

At 1415 GMT Alcatel-Lucent shares were up 13 percent at euro1.69 on the Paris stock exchange.

"Overall, this concludes a second year of strong improvement in our results, and leads to the first positive full-year net results for Alcatel-Lucent since the merger," CEO Ben Verwaayen said in a statement.

Sales to telecommunications network operators fell off sharply over the year as carriers cut back spending amid the worsening economic outlook, especially in Europe.

The company forecast further cost-cutting this year to improve on the 3.9 percent adjusted operating margin achieved in 2011, almost double the year-earlier figure but well below the 5 percent level that the company had originally targeted.

Alcatel-Lucent supplies telecommunication carriers such as AT&T, Verizon and France Telecom. It competes with European rivals such as LM Ericsson AB of Sweden and Nokia Siemens Networks of Finland.

With North American headquarters in Murray Hill, New Jersey, it has struggled for years to return to profit. Total losses since its trans-Atlantic tie-up have topped euro9 billion.

Sales were down nearly 13 percent in the fourth quarter with double-digit declines in Europe, North America and Asia. For all of 2011 Alcatel-Lucent sales were down 2.1 percent to euro15.3 billion.

Sales were particularly weak in the wireless division. The largest of the networking businesses, it saw sales slump by over a fifth in the fouth quarter, which the company blamed on slowing spending by operators, especially in North America.

In a separate statement Friday, Alcatel-Lucent said it was working with RPX Corporation of San Francisco on a plan to license its portfolio of nearly 30,000 patents in areas such as fixed and wireless communications, semiconductors and network security.

RPX buys and licenses patents and helps big companies avoid patent lawsuits. Alcatel-Lucent expects to earn "substantial proceeds" from the arrangement, Verwaayen said.



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From: Sam2/13/2012 10:32:49 PM
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Alcatel-Lucent to Announce the Latest Addition to the lightRadio Family of Products to Simplify Access to Mobile Broadband Services Everywhere


PARIS, Feb. 13, 2012 /PRNewswire via COMTEX/ -- Alcatel-Lucent (euronext and nyse:ALU) will hold a live web press conference on Tuesday February 14 to announce new innovations in the company's lightRadio(TM) family of products that will change how people think of and use mobile broadband services in the future.

The web press conference will take place February 14, 2012 at 8am PST/11am EST/5pm CET and will be co-hosted by Basil Alwan, president of Alcatel-Lucent's IP Division, and Wim Sweldens, president Alcatel-Lucent's Wireless Division.

A Q&A session will be held at the end of the presentation. Participants will have the opportunity to submit questions using the "Ask a Question" tab within the Webcast console.

Connection details:

Webcast URL with Sound:

media-server.com

Please remember to:

Disable pop up blockers to ensure easy viewing

Make sure your computer speakers are turned on and volume is turned up

If you experience buffering or other connectivity issues, press F5 on your keyboard to refresh the webcast player

To enlarge the slide presentation click the "magnifying glass" on the bottom right corner of the slide window

Dial-in 33083290 Pass code Country Local toll-free North America 800.561.2718 Australia 1800729868 Belgium 080080859 China 108007122659, 108001202659 France 0800912001, 0805540044 Germany 08003304261 Hong Kong 800962844 India 0008004401338 Italy 800979279 Japan 00531440126, 0120995390 New Zealand 0800449819 Spain 900811257 United Kingdom 08000556013, 08000858265 If journalists would like to ask questions following the event please send them to leonard.pesheck@alcatel-lucent.com or wendy.zajack@alcatel-lucent.com. Industry analysts can contact amy.huitt@alcatel-lucent.com and financial analysts, frank.maccary@alcatel-lucent.com with questions.

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From: Sam2/13/2012 11:49:43 PM
   of 172
 
Alcatel Soars 13% On Q4 Beat; Restructuring Bears Fruit
February 10, 2012, 2:02 P.M. ET
By Tiernan Ray

Shares of Alcatel-Lucent ( ALU) are up 25 cents, or 13%, at $2.19 after the company this morning reported Q4 revenue and earnings per share ahead of the consensus and said it may slash as many as 1,800 jobs in a reorganization of its European workforce.

Revenue in the three months ended in December fell 11%, year over year, but rose 9.5% from Q3's level to €4.26 billion, which in U.S. dollars comes out to $5.52 billion, beating the average $5.44 billion estimate. EPS of €0.19 beat the average €0.05 estimate, or $0.25 versus $0.07 in U.S. dollar terms.

The company generated €541 million in free cash flow in the quarter.

Separately, the company said it plans a reorganization in Europe that may cut 1,800 positions from its 25,000-person workforce, as reported by The Wall Street Journal’s Max Colchester and Nadya Masidlover.

In a separate release, the company said it would form a licensing “syndicate” to make money off its 29,000 patents.

RBC Capital’s Mark Sue reiterated a Sector Perform rating on the shares and a $2.50 price target. The restructuring efforts so far have already borne fruit, he observes.

It’s been inconsistent, yet ongoing restructuring efforts are having some effect as Alcatel posted its first annual profit since its merger back in 2006. Alcatel eliminated over €300M in annualized fixed cost savings in the quarter and reiterated its 2012 target of an additional €500M in cost reductions as it strives for normalcy. Concerns around cash flow may be moderating given the strong FCF generation of €541M following last quarter’s (€436M). Improved working capital management, specifically a €272M decline in net inventories, drove the improvement.

Michael Genovese of MKM Partners reiterates a Neutral rating on the stock.

The company’s networking business was a mixed bag:

Overall Networks segment revenues increased 8% sequentially. Wireless revenues declined 14% q/q, despite increases in Europe and Asia Pacific, due to a large drop in the Americas. Wireline revenues came in up 36% sequentially, driven by fiber access in China. Optics revenues were up 24% q/q and were strong in the Americas and Europe. This is yet another near-term positive data point for Optical demand.

And Adnaan Ahmad with Berenberg Bank today reiterates a Sell rating on the shares, writing that although the results “on a headline level (as always with Alcatel-Lucent) were robust,” nevertheless, “they may not be as good as meets the eye!”

Underlying operating margins were at 3.4% for 2011 when you exclude Genesys’s 30% EBIT margin structure versus the 3.9% “adjusted” number published, and if you put that in context versus the 4.5% street consensus for 2012, it seems that numbers have to actually come down even though the company has guided for operating margins to be higher than 2011 (3.4% or 3.9%, Mr Tufano (CFO)?).

As regards the patent licensing, “The CFO was cited “more than a few hundred million” in value terms from this deal,” but Ahmad writes that he would have liked to get “an understanding on whether this is a lump-sum, royalty-based, recurring-or-not revenue-and-income profile.”

Correction:A prior version of this post cited an incorrect amount of the earnings per share reported by Alcatel in Q4. The company turned in €0.19 per share, or $0.25 in U.S. dollar terms. My apologies for any confusion caused by the error.


blogs.barrons.com

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From: Sam2/14/2012 10:46:22 PM
   of 172
 
Alcatel-Lucent Takes Over Number Two Spot From Juniper
marketwatch.com




RENO, NV, Feb 14, 2012 (MARKETWIRE via COMTEX) -- Synergy Research Group announces the publication of the 4Q11 Carrier Infrastructure Market Share report. This report provides quarterly market shares for Service Provider Core Routers, Edge Routers, and Carrier Ethernet Switches.

The fourth quarter of 2011 saw carrier infrastructure revenues hovering around the $3 billion mark for the third successive quarter. Full-year 2011 revenues showed a 3.5% uptick from 2010, although 4Q11 revenues were actually down almost 10% against 4Q10, when the market spiked upwards. Cisco finished 2011 with a 51% market share in the final quarter and a 50% share of full-year revenues.

One of the big stories in the quarter was Alcatel-Lucent zipping past Juniper to take over the number two spot in the market share ranking -- a feat it has managed in only twice in the last four years. While Alcatel-Lucent grew its revenues strongly from the previous quarter, Juniper's revenues declined substantially, giving Alcatel-Lucent a clear market share lead of 2.7 percentage points in the quarter. For the full year Juniper did maintain its number two ranking, with a market share of 18.2% versus 16.8% for Alcatel-Lucent.

"Digging into the details, Alcatel-Lucent can thank much of its quarterly revenue growth to a strong performance in the EMEA region, where it increased its market share to over 25%. Juniper can also thank the EMEA region for providing it some bright sparks in a tough quarter -- it saw both sequential and year-on-year revenue gains to achieve a 22% regional market share in the final quarter," said Jeremy Duke, Founder & Chief Analyst, Synergy Research Group. "Conversely Cisco saw its EMEA market share drop to an all-time low of just 43%. However, there was plenty of good news for Cisco in the quarter, including a market share gain in the high-growth APAC region, increasing its share of the worldwide service provider core router market to almost 65%, and increasing its share of a declining North American edge router and switch market -- to levels it hasn't achieved in over three years."

About Synergy Research Group

Synergy Research Group ( www.srgresearch.com ), a strategic partner of TeleGeography ( www.telegeography.com ), provides market intelligence, analytics, and strategic consulting services to the networking and telecom industries. For over a decade, Synergy has been a respected leader for quantitative analysis with a focus on emerging technologies, being the first to track IP Telephony and VoIP equipment. Synergy Research Group delivers quarterly data and analytical web-based tools with a comprehensive set of syndicated research services covering UC Applications, Enterprise Voice, Data Center, Mobile Internet Infrastructure, Videoconferencing & TelePresence, Network Security, Cloud Communication & Collaboration, Content Delivery Networks, IPTV, Routers, Ethernet Switching, Service Provider VoIP, SAN, Smart Grid, WLANs, and emerging IP communication technologies.

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From: Sam2/14/2012 10:54:12 PM
   of 172
 
Alcatel-Lucent Seen as Leader in Wireless Capacity Fight: Tech February 14, 2012, 9:55 PM EST

Alcatel Rises on Profit Forecast, Patents Strategy: Paris Mover
Alcatel-Lucent Joins Ericsson, Kodak to Chase Cash From Patents

By Olga Kharif

Feb. 14 (Bloomberg) -- Sprint Nextel Corp. is in talks to use new Alcatel-Lucent telecommunications gear designed to help wireless networks handle more calls. The discussions reflect the industry’s race to avert a capacity crunch for mobile service.

Alcatel-Lucent’s lightRadio, introduced a year ago, is a Rubik’s Cube-sized device that contains radios and antennae and can be mounted on rooftops, phone poles and bus shelters to expand a network’s capacity in a given spot. LightRadio is one of several new technologies created to help the mobile-phone industry cope with the rising tide of calling and data that’s putting a strain on mobile networks just as the wireless airwaves -- or spectrum -- used to carry traffic grow scarce.

As consumers do more Web surfing and application downloading on devices such as Apple Inc.’s iPhone and tablets using Google Inc. Android software, mobile-data traffic will surge 26-fold in the five years through 2015, Cisco Systems Inc. estimates. And with limited spectrum available, mobile-service providers are looking for ways to squeeze more from existing capacity. That has Alcatel-Lucent and other gear makers racing for part of the $36 billion that Ovum predicts U.S. phone companies will devote to capital spending in 2012.

“We use technologies to mine spectrum as much as possible,” Bob Azzi, senior vice president of network at Overland Park, Kansas-based Sprint, said in an interview. “That can give us some wiggle room along the way.”

‘Spectrum Crunch’

Multiple U.S. carriers are testing lightRadio and may begin deploying it this year, Marcus Weldon, chief technology officer at Paris-based Alcatel-Lucent, said in an interview. He declined to identify the carriers. Representatives of Dallas-based AT&T Inc. and Verizon Communications Inc., based in New York, declined to comment.

“We are in a spectrum crunch,” Weldon said.

Alcatel-Lucent rose as much as 4.2 percent in Paris trading today and was up 3.6 percent at 1.71 euros as of 9:42 a.m., valuing the company at 4 billion euros ($5.3 billion).

For the past two decades, the U.S. government has helped carriers meet increased demand by auctioning off large blocks of airwaves, used to carry calls and data. Freeing new spectrum has emerged as a “crucial challenge,” Federal Communications Commission Chairman Julius Genachowski said in a speech last year. Even after new auctions happen, it would take several more years for the buyers to deploy the spectrum.

As a result, U.S. carriers may grow more dependent on new technologies to keep up with escalating user demand.

‘Waiting’ for the FCC

“The No. 1 issue for us as we move forward, and for the industry, I believe, continues to be spectrum,” AT&T Chief Executive Officer Randall Stephenson said during a January earnings call. “This growth cannot continue without more spectrum being cleared and brought to market. And despite all the speeches from the FCC, we’re all still waiting.”

Qualcomm Inc., the biggest maker of mobile-phone chips, has developed its own software and chips for small cells -- these the size of a cigarette pack -- designed to boost network capacity.

New capacity-boosting cells augur an overhaul of the design of wireless networks, which now rely on placement of large, expensive cell towers that transmit signals between handsets and the vast underground fiber-optic cable networks that send calls instantly across the globe.

“It’s going to change the way that networks get deployed, and we’re going to get the data rates through the devices up pretty dramatically by using that,” Paul Jacobs, CEO of San Diego-based Qualcomm, said during a November conference call with investors.

Revamp Costs

A recent survey by Informa Telecoms & Media showed that 60 percent of carriers say small cells of various types will be more important than traditional cells in advanced wireless networks.

Revamping networks won’t come cheap. Each cell has to be attached to existing equipment. The market for outdoor cells like those from Alcatel-Lucent could rise to as high as $8 billion by 2016, according to ABI Research. U.S. wireless carriers will increase capital spending 10 percent to $36 billion this year, according to London-based Ovum. That’s double the rate of last year.

“There’s a real concern: Can we keep up with demand?” Alcatel’s Weldon said. “There’s only one solution, and it’s a difficult solution to afford. Carriers can’t afford to increase spending much. All this means, they’ll take longer to do it. Network congestion is always going to be a factor.”

Capacity constraints already interfere with call quality and download speeds in highly populated areas. According to J.D. Power & Associates, 13 percent of all calls made with smartphones experience some degradation.

Congestion

“There are already isolated, but regularly occurring congestion issues in major cities,” Peter Rysavy, president of consulting firm Rysavy Research, said in an interview. “Over time, usage will increase, and it will constrain usefulness of the service.”

Carriers such as Sprint are coping in other ways, including shifting more traffic to local Wi-Fi networks, and using software to adjust mobile video so it takes less bandwidth during peak hours.

Sprint is also buying capacity from other network owners, such as Bellevue, Washington-based Clearwire Corp. As a result of the Clearwire arrangement, Sprint won’t face a spectrum crunch until 2016, Azzi said.

Clearwire is in discussions to provide airwaves to other carriers, Clearwire CEO Erik Prusch said in a recent interview.

“Spectrum deficiency really gets large in 2013-2014,” Prusch said. “We are talking to a lot of players, anybody who’s in need of it.” He declined to identify other carriers.

Rising Prices

Another option is for carriers to raise consumer prices, discouraging network use. Tim Horan, an analyst at Oppenheimer & Co., expects U.S. service providers to raise prices on wireless contracts at a faster pace in the coming years.

“They are going to either charge for usage more or increase the minimum amount” paid for a data plan, Horan said in an interview. AT&T in January increased the cost of its cheapest smartphone data plan for new customers to $20 a month, from $15. Several carriers moved away from unlimited data plans to limited plans last year.

For some carriers, technological innovation may do most to avert the capacity crunch, said Reed Hundt, a former chairman of the Federal Communications Commission.

“God only made a certain amount of spectrum,” Hundt said in an interview. “To go beyond that you have to have a different architectural solution, and that’s where micro cells come in.”

--With assistance from Ian King, Ari Levy and Tom Giles in San Francisco. Editors: Tom Giles, John Brecher, Nick Turner

To contact the reporter on this story: Olga Kharif in Portland at okharif@bloomberg.net

businessweek.com

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To: Sam who wrote (125)2/14/2012 10:56:16 PM
From: Sam
   of 172
 

“Licensing is a hot trend in the tech sector right now, but if these numbers turn out to be true, then maybe Alcatel should stop everything else and do only licensing,” said Thomas Langer of WestLB Equity Markets in Dusseldorf, Germany.


Alcatel-Lucent Joins Ericsson, Kodak to Chase Cash From Patents
February 13, 2012, 12:15 AM EST

Alcatel Rises on Profit Forecast, Patents Strategy: Paris Mover

By Marie Mawad

Feb. 10 (Bloomberg) -- Alcatel-Lucent, the latest technology company to announce plans to make money from its patents, may generate several hundred million euros this year alone from its trove of 29,000 rights, Chief Financial Officer Paul Tufano said in an interview today.

France’s largest telecommunications-equipment maker is offering access to its patents through a licensing syndicate. Asked whether the deal with RPX Corp. would generate a few hundred million euros, Tufano said: “More than that.”

After consuming about 3.5 billion euros ($4.6 billion) in cash over five years since the 2006 merger of Alcatel SA and Lucent Technologies, the Paris-based company is following rivals such as Ericsson AB to set up a licensing strategy as spending by phone operators on network gears slows. Alcatel-Lucent could generate 500 million euros to 1 billion euros in revenue in 2012 from the patents, according to four analysts.

“Licensing is a hot trend in the tech sector right now, but if these numbers turn out to be true, then maybe Alcatel should stop everything else and do only licensing,” said Thomas Langer of WestLB Equity Markets in Dusseldorf, Germany.

Simon Poulter, a spokesman for Alcatel-Lucent, declined to comment on the revenue projections.

Google Inc. bid $12.5 billion last year for Motorola Mobility Holdings Inc. as part of a growing trend of technology companies buying patents to defend themselves again intellectual-property suits.

Voice Recognition

Eastman Kodak Co., the photography pioneer that filed for bankruptcy protection last month, is seeking to license its brand to other camera makers as it exits the market in the first half of 2012.

Alcatel does not plan to sell its patent portfolio, which includes voice-recognition and videoconferencing technology, Chief Executive Officer Ben Verwaayen said on a conference call. “By syndicating the patent portfolio, we found a creative way to extract value without weakening ownership.”

Asset disposal has been part of the CEO’s turnaround plan for the company. Verwaayen, who took over in 2008, has sold a stake in the aerospace manufacturer Thales. Alcatel-Lucent this month completed a $1.5 billion transaction to sell its Genesys call-center software unit to Permira Advisers LLP.

Alcatel-Lucent rose 12 percent to 1.69 euros as of 2:21 p.m. in Paris trading. The stock jumped as much as 22 percent earlier today, the most since October 2008, after the gear maker forecast higher profit margins and positive cash generation in 2012.

Last year marked the end of Verwaayen’s three-year strategy to return the company to a profit. Alcatel reported its first full-year net profit in six years, though it has pushed back to 2012 its goal of generating positive cash flow.

Alcatel Chairman Philippe Camus praised Verwaayen in a Nov. 18 statement, after the Wall Street Journal reported that the company’s board was facing investor pressure to replace the CEO.

--Editors: Kenneth Wong, Simon Thiel

To contact the reporter on this story: Marie Mawad in Paris at mmawad1@bloomberg.net

businessweek.com

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To: Sam who wrote (126)2/16/2012 6:20:52 PM
From: Captain Kana
   of 172
 
I originally bought in last year when I read about cube technology. The approach for patents should be great.

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To: Captain Kana who wrote (127)2/17/2012 12:10:31 AM
From: Sam
   of 172
 
That is when I first bought it too. Averaged down a couple of times, sold some for a tax loss last year, still well under water on it, but think it will eventually work out. Just will take (a lot) longer than I thought a year ago, that's for sure!

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From: Sam2/17/2012 11:13:36 PM
   of 172
 
Telefonica Said Poised to Pick Alcatel on Spanish Network
By Manuel Baigorri and Marie Mawad - Feb 17, 2012 12:59 PM ET
bloomberg.com

Telefonica SA (TEF), Spain’s biggest phone company, is poised to award Alcatel-Lucent (ALU) an order to build a nationwide high-speed wireless network as it seeks to win back customers of data-hungry devices lost to rival operators, two people with knowledge of the matter said.

Alcatel-Lucent (ALU), France’s largest phone-equipment maker, is the front runner to supply gear for the network based on the so- called long-term evolution technology, said the people, asking not to be identified because the deliberations are confidential. Telefonica plans to unveil details on its network strategy later this month at the Mobile World Congress in Barcelona, one of the people said.

Alcatel-Lucent jumped 5.1 percent to the highest price in more than three months. Telefonica may need to spend about 300 million euros ($394 million) to build the LTE network to cover about 65 percent of the Spanish market, based on the amount Vodafone Group Plc (VOD) invested in Germany, according to Robin Bienenstock, an analyst at Sanford C Bernstein in London. Madrid-based Telefonica is seeking to bolster its Internet offerings as competition increases in a weakening home market amid the debt crisis.

“LTE will be important, especially in rural areas” where download speeds may be limited to about 2 megabits per second, Bienenstock said. “In the absence of significant cable coverage, Telefonica’s wireline customers are threatened by faster speeds available through LTE, hence the company has to build LTE to prevent further revenue declines in these areas.”

Trial Networks A Telefonica spokesman declined to comment, as did a spokesman for Paris-based Alcatel-Lucent.

Alcatel-Lucent rose 9.1 cents to 1.87 euros in Paris, the highest level since Nov. 3. The stock has gained 55 percent this year, valuing the company at 4.3 billion euros. Telefonica climbed 1.4 percent to 13.05 euros in Madrid, snapping two days of losses.

In September, Telefonica announced that Alcatel would help set up test LTE networks in Madrid and Barcelona for businesses and institutions. The plan was to extend high-speed services to all segments in the market from companies to consumers.

At the end of September, Telefonica had 24.1 million wireless customers in Spain, a market with a wireless penetration rate of 129 percent, according to the company. Telefonica competes with Vodafone Group Plc and France Telecom SA’s local units as well as TeliaSonera AB’s Yoigo division.

During the first phase of the trial networks, Alcatel- Lucent (ALU) provided network infrastructure and China’s Huawei Technologies Co. supplied USB modems.

Ericsson, Nokia Siemens Alcatel-Lucent is pushing fourth-generation wireless technologies to compete with Ericsson AB and Nokia Siemens Networks. The French gear maker was selected by AT&T Inc. (T) and Verizon (VZ) Wireless to deploy next generation networks in the U.S.

The company held a 30 percent share of the 4G equipment market at the end of September, according to data compiled by researcher Dell’Oro Group. It trails Ericsson, whose share is estimated at 44 percent.

Alcatel-Lucent is involved in 70 LTE deployment trials worldwide, according to its website, including with China Mobile.

To contact the reporters on this story: Manuel Baigorri in Madrid at mbaigorri@bloomberg.net; Marie Mawad in Paris at mmawad1@bloomberg.net



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To: Sam who wrote (129)2/18/2012 12:09:08 PM
From: Captain Kana
   of 172
 
That's more good news. Almost double the volume yesterday, and climbing in price. I bought more. Probably will on Tuesday too.

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