Ceragon laying off 200

On Monday, communications equipment maker Ceragon Networks Ltd. (Nasdaq: CRNT; TASE:CRNT) announced a streamlining plan, which will include layoffs. Sources inform ''Globes'' that the company will fire almost 200 employees, including 60 in Israel. The company currently has 1,300 employees, 15% of whom it will fire. It had 328 employees in Israel at the end of 2012. The remaining employees will apparently have to take pay cuts.

On Monday, Ceragon published a fairly weak financial report for the third quarter and announced the streamlining plan that includes layoffs, the consolidation of departments, and other cost-cutting measures intended to improve its profitability. The company expects the restructuring to save $25 million a year. The measures include the consolidation of R&D activities worldwide and a focus on new products from the IP-20 platform, the consolidation or relocation or certain offices, and the reduction of staff functions and some operations positions

This is Ceragon's second round of layoffs since it acquired Nera Networks in 2011. In the previous round of layoffs, it fired 200 employees, but only a few Israeli employees were fired.

"Our bookings and revenues remain stable in a challenging operator spending environment," said Ceragon president and CEO Ira Palti. "The new products platform that we launched a week ago was a strategic milestone for Ceragon. We continue to garner excellent feedback on our new products, whether deployed in live networks or in ongoing trials with Tier-1 operators, as they prepare to deploy LTE networks.

"Now that we have completed this major development phase, we are implementing an organizational restructuring aimed at lowering our revenue breakeven point by reducing our operating expenses by 15%. We believe this new cost structure will be sustainable as revenue growth resumes and will position us to achieve substantial additional operating leverage,"

Ceragon supplies wireless high-capacity backhaul solutions for communications between base stations and network main switches. Third quarter revenue totaled $92.1 million, 21.3% less than for the corresponding quarter of 2012. GAAP-based net loss was $10.4 million and non-GAAP net loss was $4.5 million.

Published by Globes [online], Israel business news - www.globes-online.com - on November 12, 2013