Nortel plans more layoffs

Nortel (NT) is cutting back again. The Toronto-based telecom equipment company said it will cut 2,100 jobs from its 33,000-member workforce, while moving an added 1,000 jobs overseas in its latest bid to reduce costs. The move comes as the company posted a steep fourth-quarter loss and a 4% drop in revenue from year-ago levels, as North American telcos pull back on their network spending. Nortel lost $844 million, or $1.70 a share, for the quarter ended Dec. 31, compared with a year-ago loss of $80 million, or 19 cents a share. That latest quarter was hit by Nortel’s decision to reduce the value of its deferred tax assets - losses that can be carried forward to be applied to cut taxes on future profits - by $1 billion. The company cited “changes in Canadian tax profile” for that move.

“Our ultimate goal is to build a high-performance, efficient and simple organization within a cost structure that allows us to compete and win effectively against any competitor in the world,” said CEO Mike Zafirovski. To that end, Nortel has now cut 5,000 jobs over the past year, and has announced cutbacks in each of the past four years. But like rival Alcatel-Lucent (ALU), Nortel appears to be rapidly losing ground as big customers such as AT&T (T) and Verizon (VZ) emphasize investments in newer technologies that give consumers access to phone, Internet and television service over one line. That’s why the company is reportedly discussing a joint venture with Motorola (MOT) that could give it more scale to compete with bigger rivals. Wednesday’s numbers say Nortel needs to do something, and fast.