Asia Pacific has been one of the biggest winners in the telco industry
Nortel Networks Corporation announced that Guangdong Nortel Telecommunication Equipment (“GDNT”), a Chinese joint venture between Nortel Networks Limited, Nortel China Limited and certain third parties, has entered into an asset sale agreement with Ericsson (China) Communications Company Ltd. (“Ericsson”) for the sale of substantially all of the assets of GDNT for a purchase price of approximately U.S. $50 million in cash, subject to certain purchase price adjustments. Nortel subsidiaries Nortel Networks Limited and Nortel China Limited together own 62 percent of GDNT.
Nortel will work diligently with Ericsson and the other shareholders of GDNT to close the sale in the first quarter of 2011. The agreement is subject to regulatory approval and other conditions.
All of the GDNT employees will be offered employment with Ericsson.
“This sale is a milestone in that it is the last of Nortel’s significant business divestitures, which sales have preserved both Nortel
Cisco (NASDAQ: CSCO) today announced a restructuring of its Asia Pacific and Japan operations to support its investments and growth plans in the Asia Pacific and Japan region.
Effective February 2010, the company will create three theaters that will enable a more focused strategy and investment of resources to countries within the region.
China P.R.C., Hong Kong and Taiwan, formerly part of the Asia Pacific Theater, will now form a separate Greater China Theater. The remaining countries in Asia Pacific will form the Asia Pacific Theater and Cisco’s Japanese operations will continue as the Japan Theater.
The new Greater China Theater will be led by Owen Chan, President and CEO, Greater China Theater, reporting to Robert Lloyd, Executive Vice President, Worldwide Operations. Chan joined Cisco in 1999 and has been President of Cisco’s Asia Pacific region for the past five years. Under his leadership, the Asia Pacific region has been one of Cisco’s most consistent and fastest growing regions. For his new role, he will be relocating from Hong Kong to Beijing, China.
Jim Sherriff will continue in his role of developing and leading Cisco’s cross-functional execution of the company’s overall China strategy including government affairs, supply chain, product development, corporate affairs, corporate development and strategic alliances. As Chairman, Greater China Theater, Sherriff will continue reporting to Executive Vice President of Operations, Processes, and Systems Randy Pond and will continue to be based in Shanghai, China. Thomas Lam will report to Sherriff as Vice Chairman and be responsible for developing cross-functional strategies for Cisco’s Corporate Social Responsibility (CSR), corporate affairs and university relations in Greater China.
In addition to his current responsibilities leading Cisco Japan, Edzard Overbeek will assume leadership of the Asia Pacific Theater. As President, Asia Pacific and Japan Theaters, he will continue reporting to Robert Lloyd. Since taking on leadership of Cisco’s Japan Theater three years ago, Overbeek has driven growth in an extremely challenging economic environment, built strong relationships with customers and partners, and developed a world-class leadership team.
“Given the size and growth of the Chinese economy and our significant commitments to our China business, we believe designating Greater China as its own theater marks an important next step in our strategy,” said Lloyd. “Together, the Japan, Greater China and Asia Pacific Theaters comprise approximately 15% of Cisco’s worldwide revenue and, as home to some of the world’s most dynamic economies, represent sizeable long term growth opportunities for Cisco. Under Edzard, Owen, and Jim’s leadership, Cisco will be able to maximize these opportunities by providing increased focus on our customer and partner relationships in the region.”
The world took a big step closer today to a green and more sustainable communications future with the launch of Green Touch , a global consortium organized by Bell Labs whose goal is to create the technologies needed to make communications networks 1000 times more energy efficient than they are today.
A thousand-fold reduction is roughly equivalent to being able to power the world
3Com Corporation (Nasdaq: COMS) today reported financial results for its fiscal 2010 second quarter, which ended November 27, 2009. Revenue in the quarter was $322.2 million, compared to revenue of $354.6 million in the corresponding period in fiscal 2009, a 9.1 percent decrease.
Second quarter revenue increased 10.9 percent sequentially, from $290.5 million in the prior quarter. Revenue grew sequentially across all major sales regions, primarily driven by a solid recovery in the Europe, Middle East and Africa region and in our Latin America business, and continued strong performance in China. Sales to Huawei continued to decline as expected, coming in at $18.2 million, down 35.3 percent sequentially, while China based direct-touch sales reached $151.1 million in the quarter, up 21.9 percent sequentially.
3Com achieved gross margin in the quarter of 60.1 percent. This compares with gross margin of 57.3 percent in the first quarter of fiscal year 2010, and 56.3 percent in second quarter of fiscal year 2009.
3Com also achieved GAAP operating profit margin of 4.5 percent in the quarter. Non-GAAP operating profit margin hit a record 13.5 percent in the second quarter, compared with 9.1 percent in the first quarter of fiscal year 2010, and 10.8 percent in the second quarter of the prior year.
Net income in the quarter was $20.0 million, or $0.05 per diluted share, compared with net income of $12.9 million, or $0.03 per diluted share, in the second quarter of fiscal year 2009. Q2 FY10 results include a favorable tax adjustment of $10.8 million offset in part by transaction costs of approximately $4.6 million relating to the Company’s pending merger with Hewlett-Packard Company. On a non-GAAP basis, net income for the second quarter of fiscal year 2010 was $38.3 million, or $0.09 per diluted share, compared with net income of $46.9 million, or $0.12 per diluted share, for the second quarter of fiscal year 2009.
3Com generated $118.2 million in cash from operations in the quarter. 3Com’s cash and equivalents and short term investments balance at November 27, 2009 was $704.1 million. During the quarter 3Com repaid $88.0 million of its debt, including a voluntary payment of $40.0 million.
“We are pleased with 3Com’s performance in the quarter,” said Bob Mao, 3Com’s Chief Executive Officer. “We exceeded our guidance for revenue, operating profit, earnings per share, and our cash balance, while delivering sequential revenue growth across all our sales regions and achieving record gross and operating margins.”
3Com Corporation does not intend, and disclaims any obligation, to update any forward-looking information contained in this release or with respect to the announcements described herein.
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