Alcatel-Lucent (Alcatel-Lucent) Operating Income : $-1,047 Mil (TTM As of Jun. 2016)

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What is Alcatel-Lucent Operating Income?

Alcatel-Lucent's Operating Income for the three months ended in Jun. 2016 was $-1,756 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2016 was $-1,047 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Alcatel-Lucent's Operating Income for the three months ended in Jun. 2016 was $-1,756 Mil. Alcatel-Lucent's Revenue for the three months ended in Jun. 2016 was $2,174 Mil. Therefore, Alcatel-Lucent's Operating Margin % for the quarter that ended in Jun. 2016 was -80.78%.

Alcatel-Lucent's 5-Year average Growth Rate for Operating Margin % was 0.00% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Alcatel-Lucent's annualized ROC % for the quarter that ended in Jun. 2016 was 16.60%. Alcatel-Lucent's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2016 was -507.08%.

Alcatel-Lucent Operating Income Historical Data

The historical data trend for Alcatel-Lucent's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Alcatel-Lucent Operating Income Chart

Alcatel-Lucent Annual Data

Trend

Dec06

Dec07

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Dec15

Operating Income

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153.95

-2,174.54

-1,020.55

168.93

738.56

Alcatel-Lucent Quarterly Data
	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Jun16
Operating Income	Get a 7-Day Free Trial															88.75	53.87	-107.74	816.99	-1,756.18

Alcatel-Lucent Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Jun. 2016 adds up the quarterly data reported by the company within the most recent 12 months, which was $-1,047 Mil.

Alcatel-Lucent (OTCPK:ALALF) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Alcatel-Lucent's annualized ROC % for the quarter that ended in Jun. 2016 is calculated as:

	ROC % (Q: Jun. 2016 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2015 )	+	Invested Capital (Q: Jun. 2016 ))	/ count )
=	-7024.72 * ( 1 - 145.18% )	/	( (17980.391	+	20260.674)	/ 2 )
=	3173.768496	/	19120.5325
=	16.60 %

where

	Invested Capital		(Q: Dec. 2015 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	25907.407	-	3968.41	-	( 7114.379	-	max(0, 8668.845	-	12627.451	+	7114.379	))
=	17980.391

	Invested Capital		(Q: Jun. 2016 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	26067.416	-	3101.124	-	( 4860.674	-	max(0, 8417.978	-	11123.596	+	4860.674	))
=	20260.674

Note: The Operating Income data used here is four times the quarterly (Jun. 2016) data.

2. Joel Greenblatt's definition of Return on Capital:

Alcatel-Lucent's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2016 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Jun. 2016 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Dec. 2015		Q: Jun. 2016
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	-7514.608	/	( ( (1505.447 + max(-2417.211, 0))	+	(1458.427 + max(-4184.27, 0)) )	/	2 )
=	-7514.608	/	( ( 1505.447	+	1458.427 )	/	2 )
=	-7514.608	/	1481.937
=	-507.08 %

where Working Capital is:

	Working Capital		(Q: Dec. 2015 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(2938.998	+	1742.919	+	938.998)	-	(3968.41	+	864.924	+	3204.792)
=	-2417.211

	Working Capital		(Q: Jun. 2016 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(0	+	1761.798	+	1228.09)	-	(3101.124	+	960.674	+	3112.36)
=	-4184.27

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Jun. 2016) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Alcatel-Lucent's Operating Margin % for the quarter that ended in Jun. 2016 is calculated as:

Operating Margin %	=	Operating Income (Q: Jun. 2016 )	/	Revenue (Q: Jun. 2016 )
	=	-1756.18	/	2174.157
	=	-80.78 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Alcatel-Lucent Operating Income Related Terms

Thank you for viewing the detailed overview of Alcatel-Lucent's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Alcatel-Lucent (Alcatel-Lucent) Business Description

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http://www.alcatel-lucent.com

Alcatel-Lucent SA was incorporated on June 18, 1898. The Company is engaged in designing, manufacturing, operations and sales of equipment, material and software related to domestic, industrial, civil, military or other applications concerning electricity, telecommunications, computers, electronics, aerospace industry, nuclear energy, metallurgy, and, in general, of all the means of production or transmission of energy or communication. The Company's core Networking segment includes three business divisions: IP Routing, IP Transport and IP Platforms. The IP ROUTING focus is on the intelligent IP router market and emerging Software Defined Networking (SDN) markets and related professional services. In IP TRANSPORT segment company designs, manufactures and markets optical networking equipment to transport information over fiber optic connections over long distances on land or under sea, as well as for short distances in metropolitan and regional areas. The portfolio also includes related professional services and microwave wireless transmission equipment. In IP PLATFORMS, the Company offers software and services to service providers that allow them to meet the market evolution needs of mobile and fixed networks. The Company's access segment includes four business divisions: WIRELESS are committed to a wireless access portfolio that is suited to the operators that are moving to 4G/LTE quickly and decisively. FIXED ACCESS IP-based fixed access products and related professional services provides support for both DSL and fiber, allowing service providers to extend Ultra-Broadband access to the customer's premise regardless of technology and to seamlessly combine copper and fiber access technologies and FTTx deployment models to achieve the fastest return-on-investment and time-to-market. In LICENSING the Intellectual Property Business Group works to monetize the patent portfolio through licensing and patent sales while also maintaining and prosecuting patents. The managed services portfolio includes Build-Operate-Manage-Transfer (BOMT) Solutions, Operations Transformation Solutions, and Network Operations Services. These services can be delivered across a wide array of network technologies including Network Access (FTTx), Next generation wireless (LTE, Small Cells, 4G), and IP Networks. The Company's Other segment includes Enterprise and Government businesses to provide end-to-end products, solutions and services for small, medium, large and extra-large companies to improve conversations and collaboration across employees, customers and partners. The Company sells all of its products and services to the world's telecommunications service providers through its direct sales force. The Company's competitors include Avaya, Cisco Systems, Ericsson, Fujitsu, Huawei, Nokia Solutions and Networks (NSN), Samsung, Adtran, Calix, Ciena, Juniper, Ericsson and Huawei.