Alcatel’s net profit fell to Euro 113 million ($140.5 million) from Euro 136 million in the first quarter of 2006, in line with analysts’ expectations, but the gross margin was down 1.5 per cent at 34.9 per cent during the period as fierce pricing pressure squeezed results despite strong sales. Alcatel, which had earlier announced a merger agreement with Lucent Technologies of the US in a $13.4 billion deal to create the world’s second largest telecommunication equipment manufacturer, said that it made Euro 117 million in profit before tax and discontinued operations on revenues that rose 17.6 per cent to Euro 3.07 billion.
