Nortel Expects to Beat Forecasts

Fiber-optic equipment maker Nortel Networks Corp., whose third-quarter sales missed forecasts, said it expects fourth-quarter revenue to beat analysts’ estimates, while earnings excluding one-time items and acquisition costs will be in line with forecasts. Revenue is expected to be $8.5 billion to $8.8 billion, more than the $7.85 billion average estimate of eight analysts polled by First Call/Thomson Financial. Nortel expects to earn 26 cents a share for the quarter before gains, charges, acquisition-related costs and stock option compensation from transactions, which would match analysts’ estimates published by First Call. Revenue and per-share earnings growth will be in the low 40% range for 2000 and 30% to 35% next year, the company said. Nortel shares fell 29% to $44.88 on Oct. 25 after the company reported third-quarter sales that missed expectations for the first time in 18 months because it failed to install some fiber-optic equipment. The shares of Ontario, Canada-based Nortel fell $1.50 to close at $44 on the New York Stock Exchange.