Avaya Unveils Vibrant Earnings

Amidst burgeoning attention focused on IP telephony, Avaya continued its product and announcement streak with its fourth quarter and FY 2004 earnings report. Posting strong numbers the business communications provider reported a net income of $100 million, or earnings of 21 cents per diluted share in the fourth fiscal quarter, almost doubling its same-quarter last-year income from continuing operations of $55 million, or 13 cents a diluted share. Fourth fiscal-quarter 2004 revenues rose 11 percent to $1.08 billion, from revenues of $971 million in the same period last year. The company reeled in $4.07 billion in revenues for fiscal year 2004, a 7 percent uptake from fiscal year 2003's revenue of $3.8 billion. Avaya also reports earning $291 million, or 63 cents per diluted share from continuing operations for fiscal 2004, compared to a loss from continuing operations of $128 million, or a loss of 34 cents per diluted share in fiscal 2003. "Clearly we are enjoying significant momentum in the marketplace and we are converting that momentum into increased profitability and financial strength," said Avaya Chairman and CEO Don Peterson during a conference call. "The technology transition to IP telephony is indeed well under way, and the pace of this transition has increased in key markets, such as the U.S. This is demonstrated by the accelerating product-sales growth we generated during the past four quarters, and in particular by the double-digit sequential growth in product sales during the last half of the year." Avaya's opening of its books comes on the heels of Monday's product announcement: Avaya Service Provider-Delivered Solutions for IP telephony and contact centers is now available. According to Denzil Samuels, vice president and general manager of Avaya's Service Provider Division, the solutions can be bought on a "pay-as-you-go basis--buying it by the drink." Additionally, Avaya and Philippines Long Distance Telephone (PLDT) Company announced a three-year agreement, with PLDT marketing the hosted contact center solution from Avaya to SMBs in the Philippine market. "If you look at the market growth in the Philippines in terms of contact centers that are moving to the Philippines, it very much represents what was going on in the movement of contact centers in India several years ago," Samuels says. "The growth opportunity in the Philippines is phenomenal." Continuing with product news, Avaya also announced last Monday the launch of Avaya's Contact Center Express, a multimedia IP-enabled contact-center solution designed exclusively for medium-size businesses. Providing a full range of CTI and intelligent routing capabilities, as well as desktop applications that support centralized configuration, easy-to-install access wizards and reporting for all media channels, it can also it can integrate with traditional systems or an IP-telephony platform based on Avaya Communication Manager. Chris Selland, vice president of sell-side research for Aberdeen Group, says that Avaya has a "pretty good presence in voice over IP," and as a result the company been succeeding in its market space. "It's still an evolving space and a lot of companies have been saying, voice over IP is interesting but what do I do with it? I find it can lower my phones bills, but there's got to be more to it than that--and the contact center is a natural fit. From my perspective it makes entire sense for Avaya to be targeting this market." Related articles: The Impact of VoIP on the Customer Service Experience VoIP in the Contact Center: Another Fad or Here to Stay? Contact Center Market Absorbs IP Telephony