NEW YORK (Dow Jones)--To bring back investor confidence after its
third-quarter revenue warning last week, Northern Telecom Ltd. (NT) must demonstrate its health by reporting strong earnings, said Chief
Executive John Roth.
"I think we misread the concern in minds of analysts last week," Roth told CNBC in an interview Monday, referring to its announcement that revenue growth is slowing.
"We really didn't appreciate just how sensitive the Street was to what we considered a small revenue decline in the third quarter," he added.
The company will report third-quarter results later in October, the
executive said.
According to Roth, Nortel was more concerned with explaining in detail the progress of its acquisition of Bay Networks Inc.
"The Street has taken this very, very seriously," he said. "We were
focused on giving the analysts a good status report on how we were doing on this very important merger."
Despite its own stalling revenue growth and global financial turmoil, Roth remains confident about Nortel's ability to weather an economic downturn.
"As people worry about economics, they always look for ways of cost
reduction," he said. "There's going to be a lot of demand" for the
company's Internet switching equipment business. The Web, he added, "is a cheaper way of transmitting information than anything else."
(END) DOW JONES NEWS 10-05-98 |
