Our revenues in the quarter reflected reduced capital spending by service providers... and a severe slowdown in the US economy

John Roth Nortel

The company's loss, which was the equivalent of 12 cents per share, also came in just below analyst expectations of an 11 cent loss per share.

"Our revenues in the quarter reflected reduced capital spending by service providers and enterprises resulting from tighter capital markets and a severe slowdown in the US economy," said Nortel chief executive John Roth.

Net loss

Including charges and one-time gains, Nortel posted a net loss of $2.58bn, or 82 cents a share.

Revenues for the period ended on 31 March were $6.18bn, within the company's stated range of $6.1bn to $6.2bn.

This compares with $6.32bn last year during the same period.

For now they are going to leave everyone in the dark which doesn't instil a lot of confidence

David Heger A.G. Edwards and Sons

Because of "uncertainty" in the economy, the company declined to provide any guidance for the next quarter, or the full year.

"For now they are going to leave everyone in the dark which doesn't instil a lot of confidence that they have any handle on where the business is going at this point," said David Heger, an analyst at A.G. Edwards and Sons.

Shock warning

Nortel shocked the stock markets earlier in the quarter with a profits warning.

It subsequently lost nearly a third of its market value after it said it would suffer losses instead of the profit Wall Street expected.

Shares in Nortel fell to $17.50 at 2200 GMT in after-hours trading, a drop from $17.80 at the close.

The stock is now 78% off its 52-week high.