Alcatel reported Q1 2006 revenue of EUR 3.067 billion, up 17.8% compared with EUR 2.607 billion (up 14.9% at constant EUR/$ exchange rate) in the same period last year.
The gross margin was 34.9%. Operating profit amounted to EUR 198 million, a 6.5% operating margin. Net income (group share) for the quarter was registered at EUR 104 million or a diluted EPS of EUR 0.08 per share (US$ 0.10 per ADS), which included capital gains of EUR 0.02 per share.
Some highlights for the quarter:
- The access business registered a strong performance with 6 million DSL lines delivered, more than a 50% year on year increase (3.9 million in the same quarter last year).
- The IP service router activity also positively impacted first quarter growth, registering a 10-fold year-over-year increase.
- Optical networks grew during the quarter, primarily fueled by the carrier network transformation to video, and by the wireless providers.
- The submarine networks business registered new regional wins in the West Indies. The NGN/IMS solutions business turned in a good level of performance and registered the award of a new IMS project in the UK.
- The TDM voice activity continued to decline during the quarter.
- The mobile radio business again turned in a solid performance with the 2G solution continuing to support a strong subscriber growth in emerging countries, with a growing footprint in Africa and Middle East. Alcatel's 3G product family gained momentum during the quarter with extension phases secured at the installed bases in Western Europe and North Africa and new wins in Southeast Asia.
- In enterprise networking, the migration towards the IP telephony for small and medium businesses continued to be strong across Europe.
- Market outlook remains unchanged. Second quarter revenues are expected to grow in the mid to high single digit range.
| Segment Breakdown | First Qtr | First Qtr | Fourth Qtr |
| In EUR million | 2006 | 2005 | 2005 |
 | | | |
| Revenues | |||
| Fixed Communications | 1,273 | 987 | 1,720 |
| Mobile Communications | 908 | 789 | 1,257 |
| Private Communications | 905 | 848 | 1,161 |
| Other & Eliminations | (19) | (17) | (44) |
| Total | 3,067 | 2,607 | 4,094 |
| Income from Operations | |||
| Fixed Communications | 110 | 50 | 288 |
| Mobile Communications | 57 | 66 | 139 |
| Private Communications | 48 | 34 | 117 |
| Other & Eliminations | (17) | (43) | (3) |
| Total | 198 | 107 | 541 |
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