The big gains were made in the Enterprise Networks revenues up 26 percent year on year and 33 percent sequentially. CDMA Network revenues also demonstrated healthy gains with a 17 percent year on year growth or 24 percent sequentially.

Gross margin was 43 percent.

This all translated to a first half result of US$5.39 billion up slightly from 2004, but not enough to stave off a loss of US$4 million. The first half 2004 figures reported a net earnings of US$75 million, but this year the company has absorbed US$111 million restructuring charges and the $39 million costs of sales mentioned above.

The first half 2005 results also included adjustments related to prior periods which reduced net earnings by approximately $35 million ($6 million of which was included in the costs related to the sale of businesses and assets described above).

Overall, for the full year 2005 compared to 2004, the company expects revenue to grow in the range of 10 percent with gross margins around 40 - 44 percent and operating expenses of approximately 35 percent.

UPDATE: During a conference call with analysts Owens reportedly revealed palns for the company to cut its R&D facilities by half. Nortel currently has 30 research and development sites. Owebs said the company is working toward a long-term "plan to concentrate our research in approximately half our current number of sites," reports Reuters.

Nortel outlined the following highlights

• Nortel's wireless momentum continued globally with new contracts and deployments for high speed mobile data services, and 3G mobile voice and data solutions highlighted by Bell Mobility, Orange France, Telefónica Móviles España, SaskTel Mobility, Telesur, and Liberia's Cellcom.
  
  
• The City of San Jose launched broader and more secure access to city services for its citizens, and 'anywhere, anytime' interaction with city officials using advanced communication capabilities powered by solutions from Nortel delivered on time and on budget.
  
  
• Building on the more than 100 million users worldwide of Nortel secure connectivity technology, the deployment for Sabre Holdings of an enterprise-wide solution for internet-based travel agent connectivity is one of the largest SSL VPN deployments in the world to date.
  
  
• Continuing on Nortel's more than 15 year relationship with BT with their selection of Nortel's Communication Server (CS) 2000 carrier class voice over IP call server solution to enable the delivery of an IP-based business voice solutions aimed at large public and private sector organizations, and BT's plans to upgrade their consumer and business contact centre organization with Nortel Centrex IP enhancing the user experience for its 20 million UK customers.
  
  
• Nortel announced next-generation SONET/SDH deployments of the OME 6500 by Tiscali Italia in Italy and Impsat Fiber Networks in Argentina for converged infrastructure triple play applications and by China Mobile in China and Telesur in Suriname for wireless backhaul infrastructure optimization.  Nortel's optical technology leadership continued to build with the introduction of enhanced Reconfigurable Optical Add Drop Multiplexing (eROADM) and electronic Dynamically Compensating Optics (eDCO) that are designed to significantly extend wavelength distances and enable reduced network planning and engineering costs.
  

• Continued technology leadership with High Speed Downlink Packet Access (HSDPA) wireless broadband live network trials with Partner in Israel and BB Mobile in Japan, believed the first in each respective country.  This builds on Nortel's work with a number of wireless operators on HSDPA trials and deployments in 2005 including mm02, Orange, Vodafone and mobilkom austria. 
  
  
• Nortel announced the introduction of a new multimedia communications plug-in for Microsoft Office Outlook 2003 bringing the power of integrated voice, video and text messaging to the mass market of business communication users and enabling a new type of converged application which will add rich new communications capabilities to the large base of Outlook users.
  
  
• Customer deployments and contracts across the healthcare and government vertical market segments of Nortel's innovative and globally deployed Wireless Mesh Network solution by the City of Richardson Texas, Royal Ottawa Hospital, National Aeronautics and Space Administration (NASA), Taipei City Hospital and the City of Taipei Mobile City Project.
  

• Nortel completed the acquisition of PEC Solutions, Inc. and created a U.S. entity that operates under the name Nortel PEC Solutions.  Demonstrating immediate results of this organization was the deployment of a Nortel Wireless Mesh Network at NASA's Kennedy Space Centre.  In addition, the NASA Mission Command and Telemetry Network was also upgraded by Nortel, the same network that also supports the Mars Rover, the Hubble Telescope, and other NASA programs.
  
  
• Nortel signed a shareholders agreement with Unisystems to establish a joint venture named Uni-Nortel for sales, marketing and support of Nortel's leading-edge telecommunications equipment and networking solutions in Greece and Cyprus.
  
  

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