Avaya CEO steps down

The move came as it reported third-quarter profits were far below last year's

Donald Peterson, who has been chief executive officer (CEO) of Avaya Inc. since it was spun off from Lucent Technologies Inc. in 2000, stepped down from that job and the post of president on Tuesday. He will relinquish his position as chairman on Sept. 30.

Avaya has named Louis D'Ambrosio, formerly its senior vice president and president of global sales and marketing, as president and CEO. Also Tuesday, the company named Michael Thurk as its chief operating officer.

The shakeup came as Avaya reported third-quarter profit far below its results from a year earlier. For the fiscal third quarter ended June 30, it reported net income of US$44 million or $0.10 per share, compared with $194 million or $0.40 per share in the third quarter of 2005. Revenue grew 4.9 percent to $1.297 billion from $1.236 billion a year earlier.

The Basking Ridge, New Jersey, company is one of the top players in the transformation of telecommunications from a separate network into an application on IP (Internet Protocol) packet networks. It makes phones, servers, software and other products for IP communications as well as traditional telephony offerings. Avaya also has a large services business, which D'Ambrosio once led. The company faces an army of competitors in the burgeoning IP communications sector, including Cisco Systems Inc., Nortel Networks Corp. and even Microsoft Corp.

D'Ambrosio, 42, joined Avaya in 2002 from IBM, where he worked for 16 years in software, sales and marketing, and IBM Global Services. He began his career at AT&T, the monolithic carrier that would eventually spawn Lucent and, in turn, Avaya.

Thurk most recently was Avaya's president of global communications solutions, leading efforts to develop and deliver converged IP communications systems. He is a former Telefonaktiebolaget LM Ericsson executive who began his career at GTE, a regional carrier.

Peterson, 56, was chief financial officer of Lucent when Avaya was formed, and he was named the new company's first president and CEO. In 2002, he added the title of chairman.


Copyright © 2006 IDG Communications, Inc.

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