Mark Evans

Nortel's Q4 & 2004 results

As Neil Young kind of sang about Nortel “This week's the week, this week's the week, yeah, yeah”, Nortel is supposed to report is fouth-quarter and 2004 results before the end of April, which only leaves it five business days. While most of the details have been released, these results should give analysts a much better handle on Nortel's sales momentum and gross margins. As much as Nortel is trying to put the accounting scandal behind it while restructuring senior management, there is still trouble on the near horizon: intense competition from traditional rivals such as Alcatel and Cisco, as well as low-cost Chinese suppliers such as ZTE Corp. and Huawei Technologies armed with billions in vendor financing.
It will also be interesting to see if Nortel holds an analyst call after declining to do so after the third-quarter results were released. With its accounting woes attracting investigations from the SEC, Ontario Securities Commission, Royal Canadian Mounted Police and FBI, Nortel is still holding its financial cards very close to its chest. If it goes ahead with a conference call, analysts may hear the facts and nothing but the facts - with little insightful “colour”.