Nortel 2Q Earnings Dive $274M

Nortel Networks Corp. reported two sets of losses on Monday: the first, the resignation of unpopular CEO Mike Zafirovski, the second, of $274 million.

Those second-quarter declines amounted to 55 cents per common share, compared to a net loss of $113 million, or 23 cents per common share, during the second quarter of 2008. Reorganization expenses, bankruptcy proceedings, unfavorable currency exchange rates, income taxes and other costs contributed to the poor earnings.

Sales dropped, too, from $2.62 billion to $1.97 billion, a 25 percent decline across all business segments, Nortel said.

“While we continue to be impacted by the economic environment and the creditor protection proceedings, we have successfully stabilized the business since filing for creditor protection,” Zafirovski said in a prepared statement.

The earnings news comes amid a crush of activity at Nortel. On Friday, Canadian lawmakers held meetings to discuss whether Nortel assets should be allowed to sell to foreign companies, and the enterprise unit appears to be on the brink of a bidding war between Avaya and Siemens.

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