Lucent Technologies Inc.'s shares fell 14 percent Tuesday morning on news the telecommunications giant adjusted its revenue downward by US$125 million and its earnings by 2 cents for its fiscal fourth quarter 2000. The company also announced it could not confirm financial guidance for the current quarter.
Shares of Lucent fell $2.93 to $18 a share in early morning trading. Trading volume exceeded 19 million shares.
Lucent discovered "a revenue recognition issue" that reduced revenue by $125 million and dropped earnings by 2 cents for the fourth quarter ending Sept. 30, 2000, the company said in a statement. The revenue issue was uncovered while Lucent completed its fiscal year report, the company said in its statement.
Lucent's announcement means the company missed revised expectations of 17 cents a share by a penny for the fourth quarter, according to First Call/Thomson Financial. Prior to Tuesday's announcement, Lucent had reported fourth quarter income of $600 million, or 18 cents a share, on revenue of $9.36 billion.
The company's outside auditor and outside counsel are reviewing the revenue recognition issue and any related matters, said Henry Schacht, Lucent chairman and chief executive, in a statement. The Security and Exchange Commission has also been notified of the situation.
Schacht took over as Lucent's interim top official in October after Rich McGinn was ousted from the post after the company missed its earnings mark five quarters in a row. Schacht, 66, returned to Lucent from Avaya Inc., Lucent's networking spinoff, where he was the top executive, so he could assist in the search for a new chief executive for Lucent.
Lucent's shares ended the regular trading session Monday at US$20.93. In December of 1999, shares of Lucent traded above the $80 mark.http://www.lucent.com/.