Alcatel-Lucent (ALU), the telecom equipment merger disaster, had a bit of good news. It told investors that its cost cutting efforts were on track and that it bookings are improving.
Shares in the new company have been down this year on concerns that Q1 results showed the company struggling. But, the new information has sent the shares up almost 4%.
Either ALU is taking business from rivals including Motorola (MOT) and Nortel (NT) or the telecom equipment business is improving. With new build-outs for next generation broadband networks and 3G, the latter is likely to be true. If so, it may be a decent year for all three companies. And, it could take some focus off Motorola’s handset problems.
Douglas A. McIntyre
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