Canadian telecommunications equipment vendor Nortel Networks, on the strength of Internet networking sales, has posted first-quarter earnings that surpassed Wall Street predictions.
Nortel reported net earnings for the first fiscal quarter ended March 31 of $US347 million, or 23 cents per share on a diluted basis, up from $193 million, or 14 cents per share from the year-ago quarter, a 64 per cent increase in earnings per share, the company said in a statement.
A consensus of 26 analysts polled by US research company First Call/Thomson Financial estimated that Nortel's earnings per share for the quarter would total 18 cents per share.
Factoring in acquisition costs and one-time gains and charges, Nortel recorded a net loss for the first quarter of $730 million, or 52 cents per share. The company's acquisitions included Qtera, bought this quarter for $3.25 billion, and Bay Networks, bought in 1998 and valued at $6.9 billion.
Revenue for the quarter totaled $6.32 billion, up 48 per cent from $4.29 billion reported in the year-ago quarter.
Nortel's growth derived from strong sales for optical, wireless and high-speed Internet access equipment, John Roth, Nortel president and chief executive officer, said.
For fiscal 2000 as a whole, Roth said he expects Nortel revenue to grow 30 to 35 per cent over fiscal 1999, revised upward from the company's previous estimate of 20 to 21 per cent growth for the year. The overall market will grow about 20 per cent for the year, up from Nortel's previous estimate of 14 to 15 per cent, Roth said.