Alcatel-Lucent managed to improve gross margins to 34.7% in the fourth-quarter last year with cost control measures and contribution of sales from its high-margin IP-routing business. Overall, Alcatel-Lucent declared a net profit of Euro 271 million compared to a profit of Euro 134 million a year ago. The company, however recorded a 6% reduction in year-on-year (YoY) sales, posting a total of Euro3.7 billion.
Alcatel-Lucent's Core Networking segment saw a 16% increase in YoY operating margin and a 1% increase in revenue compared to Q4 2013, amounting to Euro 1,8 billion, driven by the growth of the IP-routing segment. For the full year 2014, however, the Core Networking segment revenues dropped by 2% to Euro 5,9 billion compared to 2013 due to IP Platforms legacy, said Alcatel-Lucent.
- Access segment revenues were Euro 1,9 billion in Q4 2014, an 11% decrease compared to Q4 2013. Alcatel-Lucent said it continued to diversify its LTE customer base, with 11 new wins in the fourth quarter including AINMT in Scandinavia and expanded its small cell presence, signing 3 new customers, bringing its total to 76.
Michel Combes, CEO of Alcatel-Lucent
Our fourth quarter and full year 2014 results underline the success of our turnaround. Through the execution of The Shift Plan, we have improved our underlying profitability and free cash flow profile while we have solidified the entire organization. Entering 2015, we are in a strong position to capitalize on profitable growth opportunities and will focus on operational excellence and quality of service. The achievements we have made in our product portfolio and operational transformation make us confident we will reach our positive free cash flow target in 2015.
