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To: Dealer who wrote (40492)	8/22/2001 5:14:59 PM
From: Dealer	Read Replies (1) \| Respond to of 65232

Tellabs: 'BUSINESS IS HORRIBLE' Tellabs to Cut 1,000 Jobs, Close 2 Facilities Dresdner Kleinwort Wasserstein analyst Eric Buck said the news was not surprising in light of previously stated targets for cutting costs and analysts had already factored such cuts into their estimates. ``Business is horrible for everybody and we're not looking for any meaningful improvement until some time in the middle of next year,'' he said. ``The best-case scenario is it stops going down. ``There's not any near-term reason to believe that we're going to see a turnaround,'' Buck added. ``This is just part of what has become a plethora of bad news for the overall (telecom equipment) industry.'' The spending slowdown has led other equipment giants, such as Nortel Networks Corp. (NYSE:NT - news)(NT.TO), Lucent Technologies Inc. (NYSE:LU - news) and Cisco Systems Inc. (Nasdaq:CSCO - news) to post quarterly losses and slash jobs in order to reduce expenses. Shawn Campbell, analyst for Northern Trust Corp.'s asset management arm, said the news was not a surprise considering telecom carriers' switch to next-generation products where Tellabs is still light. Tellabs' flagship product line -- the Titan 5000 series of optical switches that help connect voice and data traffic to the proper destination -- continues to see declining sales, he said. And the company's three next-generation products will not make up for the shortfall any time soon. Tellabs said 950 of the job cuts would be through layoffs, with another 50 employees taking early retirement. Last month, Tellabs posted a $174 million second-quarter net loss that included a $262 million restructuring charge related to the economic slowdown. It slashed profit expectations in June due to the severe slowdown in customer spending, and in April cut 6 percent of its work force. In June, Tellabs Chairman Michael Birck told Reuters: ``The telephone companies have basically stopped buying. They have turned off the spigot.''