Alcatel Lucent SA (ADR)(NYSE:ALU) announced financial results for the recently concluded 4Q2015. As per the reports, the company had targeted to end the year with decent positive free cash flow; however, well-planned services and products took the actual free cash flow figure to Euro 660 million.

Insights of Yearly Financial Results

Alcatel reported a cumulative fixed cost saving over the basic shift plan of Euro 1,031 million as compared to the initial objective of Euro 950 million. Overall core networking revenue and operating cash flow for the year were Euro 6,780 million and Euro 627 million respectively. Gross margin of Alcatel reached to 36% in 2015, around 7% higher from what company had reported in 2012. The adjusted operating margin in 2015 was 7.2%, nine percentage points higher than what it had reported in 2012.

Insights of Quarterly Financial Results

In terms of Q42015 financial performance, it reported a significant increment of 15% YOY and 6% on a constant basis in its gross revenues. The gross margin for the quarter was 39.4%, 470 bps higher than the gross margin reported by Alcatel during the same period last year. This growth in gross margin was driven by increased software sales.

When it comes to adjusted operating profit, Alcatel reported Euro 560 million for the quarter, almost double than what it had reported previously. The operating profit margin for the same period increased by 580 bps to touch 13.5% mark. It could have been possible due to lower operating expenses and decent growth in gross margin.

The group share of net income for the quarter was Euro 589 million, way ahead of what the management had expected. Free cash flow for the quarter was recorded as Euro 1,020 million, highest ever since Alcatel-Lucent merger.

The senior management team of the company was delighted to witness this performance and hoped that it would continue to improve in the coming months as well.