Nortel to cut 3,500 more jobs

30 May 2002 -- After revising its Q2/2002 revenue expectations to flat to down 5% from Q1's USD2.91bn and saying that it doesn't expect a long-haul optical recovery before late 2003 or early 2004, Nortel Networks Corp is to cut another 3,500 jobs from its long-haul business by end-Q3 at a charge of about USD600m. It is also looking at selling or resizing its optical-components business.

Nortel now expects staffing to bottom at 42,000 rather than 44,000. After cutting about 50,000 jobs since the start of 2001, the company employed 47,000 at end-Q1/2002.

Nortel had revenues of USD17.51bn last year but, with USD4.8bn of debt, plans to lower its break-even cost structure from USD3.5bn to USD3.2bn of quarterly revenues by Q4.