Nortel sharpens axe following losses

Nortel sharpens axe following losses

Networking vendor to trim 2,100 jobs after registering $844m quarterly loss

Networking vendor Nortel has posted fourth quarter results revealing a huge net loss and warned of job cuts across its global workforce.

Turnover for Q4 was $3.2bn (£1.6bn), down 4 per cent on 2006. Net losses hit $844m, which was attributed to a one-off tax payment of more than $1bn and marked a huge increase on the $80m loss ion Q4 2006. Turnover for the whole of 2007 was $10.95bn, down 4 per cent on last year. Nortel predicted that revenues for the coming year would grow "in the low single digits".

The company also announced that 2,100 jobs would be cut across its worldwide operation and a further 1,000 will be switched to lower cost countries. Nortel claimed this could result in a yearly saving of $300m.

Nortel chief executive Mike Zafirovski said: "Nortel continued to make strong progress in the fourth quarter as we completed a pivotal year in our transformation. We are just over two years into a major transformation of Nortel.

"Significant progress has been made while upholding the highest standards of ethics and integrity. We have increased our profitability, improved organisational effectiveness and enhanced our competitiveness in the market."