Avaya announced yesterday that it has eliminated 1900 jobs while lowering its revenue projections for the second quarter and announcing the sale of a minority stake in the company to Warburg Pincus Equity Partners.
The company said its revenues for the fiscal quarter ending March 31 are expected to be between $US1.24 billion and $1.28 billion. Prior to this week's announcement, Avaya had told investors its second-quarter revenues would fall between $1.25 and $1.36 billion.
Avaya also revised its loss estimates for the quarter, and expects to lose six to 10 cents per diluted share from ongoing operations for the second fiscal quarter instead of a previously estimated loss of eight cents.
The job cuts will eliminate around 8 per cent of Avaya's workforce and will help save $180 million to $200 million this year along with other restructuring moves, the company said.
Avaya also said it will sell 14.4 million shares of common stock - valued at $6.26 per share - to Warbug Pincus. The deal will give the private equity firm about 15.5 per cent of Avaya's total outstanding shares.
The former enterprise arm of Lucent, Avaya competes with Nortel, Siemens and NEC in the corporate PBX market and Alcatel, Cisco, Nortel, Extreme, Foundry and 3Com in the enterprise datacom and IP voice markets.