Mixed News from Nortel

The bad news is Nortel will post first-quarter loss deeper than a year ago on soft sales. The good news is life will be good again by 2009 when operating margins will be in the double-digits. So, this means investors need to digest the painful news of today, and then buy into the assumption that three years from now everything will be A-OK. Well, maybe Mike Zafirovski has a turnaround plan that will allow Nortel to thrive financially with a lower costructure but three years is a long time from now and I find it hard to believe investors have enough faith in Nortel to buy into the concept of better times ahead. "We can and we will recreate a great company," Zafirovski said today in a conference call with analysts…before adding that "we have real work ahead of us on margins – on our SG&A costs and getting return on a very significant R&D (research and development) spend." So do you believe?

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One Response to “Mixed News from Nortel”

  1. Jonh Says:

    Hello! Good Design! Online graduate

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