3Com Posts Fourth-Quarter Net Loss
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SAN JOSE, Calif. (AP) _ Network equipment maker 3Com Corp. posted a loss on Tuesday of $23.8 million for its fiscal fourth quarter, beating Wall Street expectations even as sales continued to fall.
For the three months ended May 31, the company reported a loss of 7 cents a share on sales of $339 million, compared with a loss of $518 million, or $1.52 a share, on revenue of $468 million in the same period a year ago.
Excluding one-time charges, 3Com earned $13 million, or 4 cents a share, compared with a loss of $206 million, or 61 cents a share, in the year-ago period.
Analysts were expecting a loss of 2 cents a share on sales of $342 million, according to a survey by Thomson Financial/First Call.
``We made extraordinary progress in a difficult year,″ said Bruce Claflin, 3Com’s chief executive. ``We exit the year in fundamentally better shape in almost every aspect from customer relations to financial performance, and are well positioned for the future.″
The company also announced that chief financial officer Mike Rescoe has stepped down for family reasons. He has been replaced by Mark A. Slaven, another 3Com financial executive.
3Com had said it expected to return to pro forma profitability by the end of the fourth quarter. In March, Claflin said fourth quarter sales were expected to be 5 percent higher or lower than third quarter levels.
The Santa Clara, Calif.-based company has downsized itself dramatically in recent months.
3Com has endured more than a year of cost-cutting and layoffs as the tech downturn grew into a complete meltdown. It stumbled as it attempted to enter new markets such as Internet appliances.
It now has about 4,900 employees compared with about 12,000 at the beginning of last year.
Claflin said the company will combine two of its three business units and continue to outsource some operations. He said the moves will result in targeted job cuts, but he provided no specific numbers.
The company said first-quarter sales are expected to be down as much as 10 percent. It forecast a pro forma loss of between 3 cents and 6 cents per share.
For the full fiscal year, 3Com posted a loss of $596 million, or $1.71 a share, on sales of $1.5 billion. That compares with a loss of $965 million, or $2.81 a share, on sales of $2.8 billion the previous year.
Shares of 3Com closed down 30 cents, to $4.10, in Tuesday trading on the Nasdaq Stock Market. After the earnings release, shares gained 42 cents, or more than 10 percent, in the extended session trading.
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