Comverse hit by cash crisis

 

In a letter to employees CEO Andre Dahan described the result as “disappointing” and said company aimed to cut $45 million in costs by the end of the year.

 

He expected India sales to pick up after the government ends its freeze on telecom equipment purchases.

 

However, cash reserves could be $50 million short by the end of the April 2011 quarter if those initiatives fail.

 

Analysts at Gerson Lehman Group were skeptical about Comverse’s plan, calling the cost-reduction targets “very ambitious,” and noting that cost cutting can “consume cash in the short term.”