• Create BookmarkCreate Bookmark
  • Create Note or TagCreate Note or Tag
  • PrintPrint
Share this Page URL
Help

Chapter 8. Earnings Tricks and Games: Ma... > Red Flag 9: When Net Profit Is Risin...

Red Flag 9: When Net Profit Is Rising but Cash Flow Is Declining or Negative

When Lucent Technologies reported its financial results on October 26, 1999, the telecom equipment maker’s then CEO Richard McGinn boasted of achieving the strongest quarter and the strongest year in the company’s history. “Lucent enters the new millennium with momentum,” he declared. The figures the company issued in its press release seemed to bear out his confidence. The company’s net profit (including one-time items) had more than quadrupled to $4.77 billion from $1.04 billion the year before, and even after taking non-recurring gains and losses out of the picture, profit was still up 46 percent.


PREVIEW

                                                                          

Not a subscriber?

Start A Free Trial


  
  • Creative Edge
  • Create BookmarkCreate Bookmark
  • Create Note or TagCreate Note or Tag
  • PrintPrint