Corvis Corp. said quarterly sales declined 94 percent, to a meager $1.4 million, as the fiber-optics maker promised to cut expenses and wait out the telecommunications slump.
The Columbia company, which makes products that transmit high-speed data over long distances, said it lost $127.4 million (31 cents per share). That compared with a loss of $80.6 million (23 cents) on revenue of $24.2 million during the same period a year ago.
"The market remains challenging and in many areas continues to get worse," David R. Huber, Corvis's chairman and chief executive, said in a conference call yesterday. "We're working hard to be first in line when the investment of service providers starts to flow."
Corvis's third-quarter sales fell below Merrill Lynch & Co. analyst Simon Leopold's expectations of $2.5 million. The challenge for the company will be not only its financial performance but also its ability to land business next year, he said.
The fiber-optics sector has been dormant as telecommunications companies have stopped spending. And although Corvis has enough cash to last it several years, it lacks the broader customer base of its more established competitors, Leopold said.
The company said it will begin buying back up to $25 million of its stock on the open market. At yesterday's closing price of 66 cents -- that would amount to about 10 percent of its outstanding stock.
Corvis named two new members to its board of directors: Freeman A. Hrabowski III, president of the University of Maryland in Baltimore County, and Donald R. Walker, former chief executive of computer security firm Veritect Inc. and a retired Air Force brigadier general.
Corvis also announced yesterday that it will lay off 164 people in its Algety Telecom division in France, as part of previously announced workforce reductions. It took a $55.6 million restructuring charge during the quarter associated with workforce reductions and with a write-down of obsolete inventory. At the end of the quarter, Corvis employed 883 people, down 20 percent from the previous quarter. After the Algety layoffs are completed in January, the company will employ 719 people.