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Avaya Inc., a leading global provider of business
communications applications, systems and services, today reported
net income of $71 million or 15 cents per diluted share for the
first fiscal quarter of 2007 on a U.S . generally accepted
accounting principles (GAAP) basis. In the first fiscal quarter of
2006, the company reported net income of $71 million or 15 cents per
diluted share on a GAAP basis. Non-GAAP net income for the first
fiscal quarter of 2007 was $61 million or 13 cents per diluted
share. (See chart accompanying release.)
"During the first quarter, we invested in our business to
extend our technology leadership, effectively managed costs and
expenses, attracted new talent to our senior management team and
delivered solid bottom line results," said Lou D'Ambrosio,
president and CEO, Avaya. "We will continue to be relentlessly
focused on our three priorities: strategy, execution and
culture."
The company reported operating income for the first fiscal quarter
of 2007 of $90 million. Non-GAAP operating income in the quarter was
$96 million. (See chart accompanying release.)
Avaya's first fiscal quarter 2007 revenues increased 2.5 percent to
$1.280 billion compared to $1.249 billion in the same period last
year. Avaya shipped more than one million IP lines for the third
consecutive quarter. Avaya noted that as discussed in its Form 10-K
for fiscal 2006, during the first quarter it experienced delays and
disruption in the delivery of its products to customers due to
changes made in its warehousing and distribution operations and
estimates the impact on revenue in the quarter was approximately $20
million.
The company's services segment revenues increased for the third
consecutive year-over-year quarter with strong performance in
professional services, maintenance, and managed services.
Avaya ended the quarter with cash of $895 million, relatively flat
with the fourth quarter of fiscal 2006. The provision for income
taxes in the quarter benefited from discrete tax benefits, including
a retroactive extension of the
U.S. federal research and development tax credit.
First Fiscal Quarter Highlights
Since the end of the last quarter, Avaya has added several new
members to its executive team.
Caroline Dorsa will become Avaya's Chief Financial Officer. Dorsa
joins Avaya from Merck and Co, Inc. where she has held senior
leadership roles in finance and line operations. Most recently, she
was Vice President and Treasurer for Merck where she led a broad
portfolio, including treasury, investor relations, tax,
controllership for manufacturing, and portfolio management.
Stuart Wells will join Avaya from Sun Microsystems and lead Avaya's
Global Communication Solutions. Wells held a series of senior
leadership roles at Sun, with a particular focus on software and
on-demand computing. Most recently he served as executive vice
president, Utility Computing. He also was senior vice president of
eCommerce applications, middleware and communication products during
the Sun/Netscape alliance. Wells also led the Network Software
Product Group and sales leadership for the Financial Services
organization.
Lorie Buckingham has joined Avaya as chief information officer.
Lorie will champion Avaya's IT infrastructure improvements and
driving efficiencies and effectiveness in our business processes.
She joins Avaya from Visteon Corporation and brings a wealth of
knowledge and experience in IT, streamlining business processes, and
global software solutions.
During the quarter Avaya also made important strides in extending
our technology leadership.
Avaya acquired Traverse Networks, a privately held developer of
enterprise mobility solutions. Traverse develops enterprise mobility
solutions enabling enterprise workers to have their office
functionally at their fingertips, supporting a broad range of mobile
devices. The ability to send office calls to any phone, receive
calls on both office and mobile phones simultaneously and
synchronized call logs put the user in control of communications.
The company announced a tender offer to acquire Ubiquity Software
Corporation, whose product is one of the leading software platforms
for the development and delivery of SIP solutions, a critical
industry standard. Ubiquity develops and markets SIP-based
communications software for fixed and mobile communications service
providers, systems integrators, independent software vendors and
channel partners. Ubiquity's range of products has been developed to
take advantage of the telecommunications industry's migration toward
all-IP networks.
Avaya introduced Unified Communications initiatives that will
further shape the market and change how businesses deliver strategic
communications and collaboration tools to workers wherever they are,
on any device. The new family of Avaya Unified Communications
editions gives businesses the flexibility to deliver the right
applications to the right devices for various segments of workers
with different communications needs, to help employees improve
productivity wherever they are conducting business.
Avaya also continued to receive Industry recognition, including the
following:
Avaya increased its lead in the share of worldwide enterprise
telephony revenues to 20.6 percent in the third quarter according to
Dell 'Oro Group's IP Telephony Enterprise Report, 3Q06. The
company's leadership puts it three points ahead of its nearest
competitor.
Avaya extended its lead in worldwide Enterprise Internet Protocol
Telephony shipments and revenues, according to Synergy Research
Group's 3Q 2006 Enterprise Voice Market Shares Report. This is the
twelfth straight quarter in which the company led in global
enterprise IP Telephony revenues, pulling ahead by more than three
points over its nearest competitor. 
-- Tech Times
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