Struggling Sycamore (SCMR) has enlisted bankers to help the company consider its options.
Shares of the Chelmsford, Mass., networking gearmaker jumped 10% in after-hours trading Thursday after the company reported its latest quarterly loss and said it had hired Morgan Stanley to consider strategic alternatives.
For its fourth quarter ended July 31, Sycamore lost $9.2 million, or 3 cents a share, on revenue of $14.5 million. A year ago the company lost $9.7 million, or 4 cents a share, on revenue of $10.9 million.
"While we are pleased with our fiscal year 2004 revenue growth, our business continues to be impacted by industry related conditions," CEO Daniel Smith said. "In light of these circumstances, we engaged Morgan Stanley to work with us on a review of our strategic and financial alternatives aimed at maximizing shareholder value."
Sycamore makes optical equipment used by phone companies that transmit over fiber optic cables. The tech shop enjoyed a brilliant if brief popularity on Wall Street when it went public in the fall of 1999. Investors were keen on optical gearmakers, which represented the vanguard of network upgrades.
Sycamore struggled to fit its futuristic switching and transport products into the old-line needs of large phone companies. New telcos like
had been Sycamore's primary customers, but those outfits ran out of cash and curbed buildout plans after the tech bust.
Late Thursday, Sycamore rose 36 cents to $4.08.