Tellabs Shares Drop After Forecast Misses Estimates: WORST THAN ERALIER REPORT. $2.16
By Niamh Ring - Feb 1, 2013 9:36 AM ET
Tellabs Inc. (TLAB) fell to a 20-year low after forecasting first-quarter revenue that trailed analysts’ estimates and announcing a plan to discontinue its 9200 routing product and cut expenses.
Tellabs dropped 5.5 percent to $2.16 at 9:34 a.m. in New York, the lowest price since August 1993. The stock tumbled 44 percent last year while the S&P Midcap Information Technology Sector Index advanced 15 percent.
The company, which introduced the network-routing platform 9200 in 2011, said yesterday that it will be discontinued this year. Cutting expenses will affect about 300 positions, according to a statement from the Naperville, Illinois-based company, which according to its website employs about 2,600.
“Over the last quarter, Tellabs initiated a review of its strategy, product portfolio and cost structure,” Chief Executive Officer Dan Kelly said in the statement. The company plans to “demonstrate new software-defined networking and self- optimizing networks capabilities at Mobile World Congress in February,” he said.
The company forecast first-quarter revenue of $205 million to $220 million. That compared with an average analyst estimate of $238.9 million, according to data compiled by Bloomberg.
To contact the reporter on this story: Niamh Ring in New York at nring@bloomberg.net
To contact the editor responsible for this story: Kevin Miller at kmiller@bloomberg.n
