S&P; Lowers Lucent’s Bond Credit Rating

Lucent Technologies’ bond credit rating was lowered to junk status Tuesday by Standard & Poor’s.

The agency said in a statement that it dropped Lucent’s rating to BB-plus from BBB-minus because the maker of phone equipment will struggle to boost revenue, decrease costs and show an operating profit amid a slowdown in demand for telecommunications gear. A lower credit rating boosts a company’s borrowing costs for future loans.

Lucent (LU), which lost more than $4 billion in the first half of its fiscal year, has pledged to fire workers and sell businesses and plants to shed debt and reduce annual expenses by $2 billion. While the company has predicted losses will narrow in the second half, S&P; said a further decline in demand for phone equipment may force Lucent to miss its forecast.

Lucent fell 10 cents to $7.94 in NYSE trading.