Avaya Posts Flat 1Q Profit

Communication equipment and software maker Avaya reported flat first-quarter profit this week as technology investments offset a slight rise in revenue.

Net income totalled $71 million, or 15 cents per share, for the fiscal 2007 first quarter, flat with year-ago results. Excluding items, profit totalled $61 million, or 13 cents per share, in the latest period.

Revenue increased 2.5 percent to $1.28 billion from $1.25 billion in the same period last year.

Analysts surveyed by Thomson Financial were expecting profit of 13 cents per share on higher revenue of $1.31 billion.

Avaya said it shipped more than one million IP lines for the third consecutive quarter, but said it experienced delays and disruption in the delivery of its products to customers due to changes made in its warehousing and distribution operations. Avaya estimates those disruptions hurt quarterly revenue by about $20 million.

“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.

Avaya ended the quarter with cash of $895 million, relatively flat with the fourth quarter of fiscal 2006.