By Scott Moritz

Qualcomm (QCOM) joined tech’s growing crowd of downward revisionists as the slumping global economy forced the company to slash its financial targets.

While the San Diego wireless chipmaker turned in a strong fiscal fourth quarter Thursday, Qualcomm like several tech giants – including Cisco (CSCO), Intel (INTC) and Apple (AAPL) – have lowered financial projections as business took a nose dive this fall.

Qualcomm posted adjusted earnings of $1.06 billion or 63 cents a share, a 17% increase over the 54 cent pro forma profit in the year ago period and 3 cents above analysts estimates, according to Thomson First Call.

Sales for the company’s fourth quarter ended in September were $3.3 billion, up $1 billion or 45 % over the same period a year ago. Analysts had anticipated revenue of $2.86 billion.

Similar to Cisco, which saw strong pre-October results yet dire post-October conditions, Qualcomm pulled down its forecast for the current quarter.

“As a result of the credit crisis and the economic uncertainty, our guidance reflects slower end-market device growth for 2009 than previously anticipated,” said CEO Paul Jacobs in a statement.

Looking ahead, Qualcomm cut its December quarter adjusted earnings forecast to a range around 48 cents or 8% below year-ago levels. Sales are now expected to drop 4% on a year-over-year basis to $2.4 billion roughly flat sequentially. Analysts had been looking for earnings of 61 cents on revenue of $2.9 billion.

Qualcomm shares dropped 3% in after-hours trading after closing at $33.05 Thursday.

Qualcomm, which makes components for cell phones and licenses wireless technology, says December-quarter chip shipments will drop to 62.5 million from the 79 million level a year ago. And the company predicts the average selling price for mobile phones will fall to $205 from $211 last year.

By Scott Moritz

The spending slowdown hitting the technology industry has slammed Ciena (CIEN), the telecommunications equipment maker. In an earnings report Thursday, the company cited a drop in customer orders in slashing its fourth-quarter sales forecast 24% below expectations.

Ciena’s third-quarter sales and earnings were solid despite signs of sluggish demand from corporations. The Linthicum, Md.-based company posted adjusted earnings of 37 cents a share, down from 41 cents in the year-ago period, but in line with analysts’ estimates. Sales for the quarter were $253.2 million, up 23% from last year and also in line with Wall Street targets.

But looking ahead, Ciena warned that “order delays from many of our tier one service provider customers,” would likely result in fiscal fourth-quarter revenue in the $200 million range. The projected sales shortfall is well below the $263 million level analysts had been expecting.

Ciena shares fell 17% in pre-market trading Thursday.

“While current economic conditions warrant a cautious near-term outlook, the fundamental drivers of our business – growing capacity demands and the transition to more efficient, more powerful, automated networks – remain sound,” Ciena CEO Gary Smith said in a press release.

Ciena is somewhat of a niche player in the global networking sector, but its headwinds hint that spending cuts among big telcos continues and may be steepening. Rivals like Cisco (CSCO) and Ericsson (ERIC) were down 1% in early trading on news of Ciena’s big miss. Ciena also joins Corning (GLW) as the second tech shop to warn of slumping orders in recent days.

By Scott Moritz

Alcatel-Lucent (ALU), the struggling telecom equipment maker, on Tuesday named an old hand as its new chief executive. Former British Telecom (BT) chief Ben Verwaayen, who once ran Lucent’s international sales operations, has been hired to replace CEO Pat Russo.

Alcatel-Lucent also announced that Philippe Camus, the former co-chief of Airbus parent EADS, will take over as chairman, replacing Serge Tchuruk who, along with Russo, announced his resignation earlier this summer.  The news comes days after news reports identified Mike Quigley, the former president of Alcatel-Lucent, as the company’s top pick – a move that some analysts cheered.

Alcatel-Lucent shares fell 2% in late morning trading Tuesday as investors signaled their disappointment with the new hires.  As head of one of the world’s largest networking equipment companies, Verwaayen faces a difficult task of unifying the company’s disparate divisions some two years after New Jersey-based Lucent and France’s Alcatel combined.

“What a missed opportunity,” said Telecom Pragmatics analyst Sam Greenholtz after the announcement. Given Verwaayen’s international background, Greenholtz sees his appointment as a sign that the company is focusing on its European operations at a time when, he says, the company’s customer relationships in the United States are weakening.

“I am sure these guys that were chosen are worthy of the job but, it is not going to fix the poor relationships in the U.S.,” said Greenholtz.

Verwaayen spent four years at Lucent, with mixed results. He ran the company’s overseas sales and was a key proponent of the company’s vendor-finance strategy, which makes loans to customers to finance equipment purchases. Many of the loans turned sour in the post boom industry collapse, and Lucent was left holding billions of dollars in bad debt. At the same time, after the dot.com bubble burst, Verwaayen was credited with helping the company trim its product offerings and focus on a core group of financially-healthy customers.

Verwaayen left Lucent in 2001 to make way for Pat Russo, who was serving as CEO at Eastman Kodak (EK). Verwaayen then ran BT for for six years, overseeing the phone giant’s massive network upgrade known as 21st Century Network.  The expensive project has taken longer than analysts had expected, and with BT’s shares hitting a five-year low in March, Verwaayen was gone by May. 

For their part, Russo and Tchuruk went on to engineer the $11 billion merger of Alcatel and Lucent in 2006. But they have struggled from the start to integrate Lucent’s products and operations, based in New Jersey, with Alcatel’s Europe-based business, headquartered in Paris. Making matters worse, Alcatel-Lucent is facing stiff competition from Ericsson (ERIC) and China’s Huawei, among others. Amid the cutthroat rivalry, sluggish economies in the United States and Europe have forced phone companies to cut their networking-equipment spending.

In the nearly two years since the Alcatel-Lucent merger, sales have fallen 7.3% and the stock is down 55% as the company announced round after round of layoffs.

At the top of Verwaayen’s to-do list at Alcatel-Lucent: to bring the bifurcated company together and boost earnings. In July, Alcatel-Lucent posted its sixth quarterly loss in two years, a loss that prompted Russo and Tchuruk to announce they were leaving later this year.

By Scott Moritz

A year after jumping ship, former Alcatel-Lucent president Mike Quigley may be returning to take the top job at the telecom gearmaker.

Quigley, who was an early architect of the Alcatel-Lucent (ALU) merger and later ousted under CEO Pat Russo’s term, has been picked by the company’s nomination committee to replace Russo, according to a Reuters report. The company declined to comment.

In July, after Alcatel-Lucent posted its sixth quarterly loss in two years, Russo and chairman Serge Tchuruk announced they were leaving later this year.

Under Russo and Tchuruk, the company struggled to integrate Lucent’s products and operations, based in New Jersey, with Alcatel’s Europe-based business, headquartered in Paris. In the nearly two years since the merger, sales have fallen 7.3% and the stock is down 55% as the company announced round after round of layoffs.

Heightened competition from outfits like Ericsson (ERIC) and China’s Huawei, along with networking equipment spending cuts by phone companies and a sluggish economy in the United States and Europe have squeezed Alcatel-Lucent’s performance. But some analysts see a big part of the company’s problem as a lack of focus and an inability to move in the same direction that its customers were headed.

“This is a great move,” said Telecom Pragmatics analyst Sam Greenholtz. He says Quigley had butted heads with Tchuruk and likely has a better feel for the products that telcos, the bulk of Alcatel-Lucent’s customers, are looking for.

As Alcatel-Lucent’s CEO, Quigley’s first job would be to finally integrate Lucent and Alcatel’s operations, says Greenholtz. “They have to get this merger done, and I think Mike will make some hard decisions that Serge and Russo couldn’t make,” Greenholtz said.

Alcatel-Lucent shares surged 5% Tuesday on word of Quigley’s possible appointment.

By Scott Moritz

Juniper Networks (JNPR) beat second quarter expectations and says it’s more optimistic about the rest of the year.

The Sunnyvale, Calif.-based Internet gearmaker on Thursday posted earnings of $156.6 million or 28 cents a share in adjusted profit. That is up from the 20 cents in earnings recorded in the year-ago period. Analysts were looking for 27 cents on the bottom line.

The positive report comes as Juniper announced former that Kevin Johnson, Microsoft’s (MSFT) Windows chief and head of online business, would take over as CEO. Kriens will stay on as chairman.

Sales for the second quarter were $879 million, up 32% over the last year at the same time. Analysts had anticipated revenue of $852 million for the quarter ended last month.

“We’re very pleased with the solid results we have delivered for the first half of 2008,” CEO Scott Kriens said in a statement. Kriens added that demand for Juniper’s new gear underscores “our improved outlook for the second half of the year.”

With slightly improved operating margins, Juniper generated net cash from operations of $200.5 million, compared to $199.3 million for the same quarter of 2007.

Tech watchers see Juniper as a good indicator for Cisco’s (CSCO) Internet router business. And the solid performance could help ease concerns of a big  turn down.

By Jon Fortt, Fortune senior writer

HALF MOON Bay, Calif. – Sustainability will influence the next generation of Internet technology, according to Cisco (CSCO) chief technology office Padmasree Warrior.

At Fortune’s Brainstorm Tech conference on Tuesday, Warrior and technology visionaries from Nokia and Xerox sat down with Strategic News Service’s Mark Anderson Tuesday to talk about dealing with information overload, mobile innovation, and the major tech transitions ahead.

One idea that’s likely to get a lot more attention, Warrior said, is doing more while consuming fewer resources. “Sustainability is going to be a great driver,” she noted. “It’s actually innovating for constraints that will drive the next generation of technology.”

Warrior said some of the major innovation trends she’s watching are the Internet’s transition into an entertainment platform, the emergence of communities as a driving force in communication, the power of video as a business tool and the rise of new global economic powers like China and India.

Xerox (XRX) CTO Sophie Vandebroek talked about software her company is cooking up that sifts through oceans of digital information and serves up bits that are most likely to be relevant to the task at hand. For instance, for a law firm it could plow through digitized legal files and pull out information about people and events that are most likely to have an impact on a given case. It’s an attempt to help knowledge workers who are drowning in data. “It’s like food – we have too much food with these all you can eat buffets,” Vandebroek said. “You have to control yourself.”

Nokia (NOK) CTO Bob Iannucci said mobile technology is transitioning from a focus on hardware – handsets, towers and the like – to a focus on software and services. He said mainframes, mini computers and PCs all went through the same changes, and the implications were profound. One of the resulting challenges he’s pondering in a service-oriented mobile world: How do you harness the value of people’s personal information in a way that doesn’t freak them out? Can companies like Nokia give customers access to their data in a way that helps them answer questions and make purchases?

From the audience, Google (GOOG) Chief Internet Evangelist (and Internet pioneer) Vint Cerf pointed out that the way people are beginning to use the mobile Internet is fundamentally different. More than with the PC based Internet, mobile users are likely to get online for information related to where they are and what they’re doing at that moment. Warrior agreed that the tech world will have to pay more attention to that shift: “Context and location awareness will become really important,” she said.