Alcatel-Lucent won't report quarterly earnings for the first time as a combined company until Feb. 9, but already the new megamerger in town has issued a warning that fourth-quarter 2006 revenue will be lower than Alcatel's 2005 figure--and that new cost-cutting measures may lie ahead.

The company announced this morning that pro forma financial results adjusted to account for Alcatel's acquisition of Lucent, which took effect last month, include revenue of just over $5.75 billion (U.S.) for the fourth quarter, which would be sharply down from the $6.8 billion reported for the fourth quarter of 2005. Revenue for the full year is expected to come in at $23.8 billion, slightly under the $24.2 billion reported for 2005 by Alcatel. (Alcatel announced the acquisition of Lucent Technologies last February.)

Alcatel-Lucent CEO Pat Russo said in a company statement, "The last quarter of the year proved to be challenging from a market perspective, driven by a shift in spending from some of our large North American customers and heightened competition in the global wireless market. Overall, the 2006 adjusted pro-forma financial results of the combined company were impacted by the weak performance in the fourth quarter resulting in cumulative revenues for full year 2006 at a similar level to full year 2005 revenues."

She added, "In a market that continues to be highly competitive, Alcatel-Lucent has decided to take additional actions to further reduce its cost structure." However, the company revealed no further details about what kind of cost-cutting measure would be taken. Alcatel and Lucent said prior to their merger closing that almost 9000 jobs would be eliminated from the combined company over a span of several years.

Alcatel-Lucent's fourth-quarter warning comes shortly after several other vendors issued quarterly financial warnings.

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