CEO Mike Zafirovski Leaves Nortel

Nortel Networks announced recently its financial results for the second quarter of the ongoing year, and posted a 25 percent decrease in revenues when compared to the same quarter a year ago, though also registering a 14 percent increase from the previous quarter. At the same time, the company announced that during the second quarter it registered a net loss of US$274 million, up from the net loss of US$113 million it posted for the same time frame a year ago.

Mike Zafirovski, Nortel president and chief executive officer, also announced that he was stepping down from the company, and that the move would be effective immediately. At the same time, the company's Boards of Directors will only have three members, down from the nine it had until now, and these will be John A. MacNaughton, Jalynn H. Bennett and David Richardson, with Richardson being the Chairperson.

“We've reached a logical departure point,” said Harry Pearce, chairman of Nortel's Board of Directors. “Mike made a commitment to see the process through the stabilization of the company, sale of its largest assets and the right plans and people to continue operating our business and serving customers. He has done so. I appreciate the commitment and passion he brought to this company since day one, including his guidance through the extremely difficult decisions we faced since filing for creditor protection. I also wish to recognize the enormous commitment and dedication of the departing members of the Board who really believed in and worked hard for Nortel.”

According to Mike Zafirovski, the company managed to stabilize the business after filing for creditor protection, although it has been impacted by the economic downturn in all areas. The 14 percent increase in revenue on a quarterly basis is proof of the stabilization, he added, while also stating that Nortel's operating costs went down 15 percent, which was the result of strong margins. “At the same time, our customer service levels remain strong,” he concluded.