NAPERVILLE, ILL. ( TheStreet) -- On Monday, Tellabs ( TLAB) said profit dropped amid declining sales in the second-quarter.

The Naperville, Ill.-based outfit reported earnings at $15.7 million, or 4 cents a share, compared to $39 million, or 10 cents, in the year-earlier period. After excluding items, Tellabs said in a press release that it earned 8 cents a share compared to 4 cents a share last year.

Revenue for the telecommunications equipment supplier came to $385.4 million, which is down 11% from the $432.5 million in revenue posted during the year-ago quarter. All three revenue segments of the business -- broadband, transport and services -- saw declines, though it did see sales growth in broadband's data products.

On average, a group of analysts polled by Thomson Reuters expected Tellabs to report earnings at 6 cents a share on revenues of $381.3 million.

"We continue to achieve solid gross profit margins, and our business appears to be stabilizing as customers placed the strongest orders in more than a year," Tellabs CEO Rob Pullen said in a press release. "But it's too soon to predict a recovery."

Gross profit margins also grew to 43.5% as against a year-ago figure of 34.7%. The cost of revenue was slashed by 23% to come to $217.9 million in the quarter.

Looking ahead, Tellabs said it expected revenue in the next quarter to be "flat to up by a mid-single-digit percentage."

In early July, Tellabs announced plans to slash 150 jobs, or cut about 5% of its work force, in a Securities and Exchange Commission filing. The company said the restructuring plan is likely to be completed by the end of the second quarter in 2010.

Within minutes of the opening bell Monday, the stock was changing hands down 3.6% to $5.56. --David Moss reported this story from New York City.
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