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Luminent Cuts Jobs to Trim Costs

Telecom: The fiber-optic firm will take a one-time charge of $30 million to $35 million for layoffs, restructuring.

July 06, 2001|RICHARD VERRIER | TIMES STAFF WRITER

Luminent Inc., a Chatsworth provider of fiber-optic components, said Thursday that it will cut one-third of its work force, or about 600 jobs, by the end of the year.

The cost-cutting move is a response to a softening demand for its products, which are used for high-capacity data transmission.

The cuts, which began earlier this year, will leave Luminent with 1,200 employees.

Luminent said it will take a one-time charge of $30 million to $35 million in the second quarter to account for the cost of the layoffs and other restructuring expenses.

"Order levels reflect a significant reduction in capital spending by service providers, which resulted in lower-than-expected demand for fiber-optic components by equipment makers," said William Spivey, Luminent's chief executive, in a statement.

Spivey said many of Luminent's customers have built up excess inventories and reported "increasing softness" in orders in Asia and Europe.

Shares of Luminent fell 11 cents to $3.77 on Nasdaq. The news was released after the markets closed. In after-hours trading, Luminent shares fell as low as $3.60.

Despite the current downturn, Luminent has strong long-term growth prospects because the company has a diversified customer base, solid cash flow and a range of technologies, including laser manufacturing, Spivey said.

For the second quarter, which ended Saturday, Luminent expects to post revenue of $41 million, up 46% over the same period a year ago, and earnings of 2 cents a share, contrasted with a loss of 8 cents a year earlier.

The results are in line with Wall Street estimates.

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