Shares of Alcatel-Lucent (NYSE:ALU) slid more than 5% Friday morning after the company revealed a first-quarter loss on still weak European sales and concerns mounted about whether its overdependence on the U.S. as a revenue driver could crimp fiscal results.
The Paris-based telecom equipment maker said revenue climbed 15.2% year-over-year to 3.74 billion euros, about $5.23 billion, lifted by across-the-board geographical gains and growing demand in its networks business. IP sales grew more than 20%.
Despite reaffirming its annual goals, the company spooked investors with its weaker European sales, which slipped 1.8% to 1.12 billion euros, and its over reliance on the U.S. market.
Alcatel-Lucent makes about one-third of its profit from North America. The region’s sales climbed 40% from the same quarter last year to 1.56 billion euros.
“We have started this year the way we ended the last, increasing growth, profit and global strength, and to do so in the first quarter is particularly pleasing,” Alcatel-Lucent CEO Ben Verwaayen said in a statement.
For the three-month period, the company narrowed its operating loss to 55 million euros from its year-earlier loss of 263 million. Excluding one-time costs, the company earned 2 cents a share, ahead of average analyst estimates polled by Thomson Reuters of a 5-cent loss.