The loss equates to $2.31 per share and compares with a loss of $3.2 billion, or 95 cents per share, a year earlier.

In its ninth-straight money-losing quarter, revenues at the Murray Hill, N.J.-based company fell by half to $2.95 billion in the third quarter of its fiscal year. In the year-ago quarter, Lucent saw revenues of $5.9 billion.

Most of Lucent's loss was attributed to a massive $5.8 billion non-cash charge, which amounted to $1.70 per share. The company said the charge would defer a tax benefit which could be used in future years to reduce its taxable income.

In a conference call with analysts, chief executive Pat Russo said the company thought it hit bottom six months ago, and that the world's telecommunications providers would restart their stalled purchases of Lucent's switches and networking equipment.

"Like many others we were wrong," Russo said. "The level of spending has pulled back even further."

Lucent's equipment sales declined 22 percent in the United States and 20 percent elsewhere, as large telephone carriers continued to cut expenses, said chief financial officer Frank D'Amelio.

Excluding charges and other one-time items, the company said it lost 16 cents per share, a worse showing than the 14-cent per share loss expected by Wall Street analysts surveyed by Thomson Financial/First Call.

Investors fled the stock, sending Lucent shares down almost 19 percent, or 39 cents, to $1.71 in morning trading on the New York Stock Exchange.

Lucent said it took an additional $808 million restructuring charge in the quarter to fund the cutting of 7,000 of its remaining 53,000 workers, or 13 percent of its work force, by year's end.

By the time the current round of layoffs is finished, Lucent, which counted 155,000 employees at its peak in July 2000 will have whittled away 70 percent of its workers. Almost 50,000 of those workers departed during the spin-offs of Agere Systems, Avaya and the sale of Lucent's optical fiber business.

D'Amelio said the company will cut even more jobs amid continued restructuring in the fourth quarter.

"It's premature to say how many, because we don't know," D'Amelio said in a telephone interview. "We're putting the plans in place now."

Despite the dismal showing, Russo said Lucent continues to expect to return to profitability in late fiscal 2003.

In order to do so, the company will cut expenses even further - incurring yet another earnings charge in the current fourth quarter - in order to lower the amount of revenue needed to break even to below $3.5 billion from almost $4 billion, D'Amelio said.

When Lucent finally returns to profitability, Russo said the company "will grow in the mid-single digit range."

Russo also announced that Lucent will boost its presence in the growing technology services business, a refuge for an increasing number of hardware manufacturers. Companies like IBM and Hewlett-Packard have found a solid source of revenues in taking over the operations of complex computer networks from their customers.

Services companies promise clients savings on their information technology budgets, a popular option during a tough economy.

Besides selling equipment it makes, Lucent will install, maintain, build and operate communications networks for its clients, Russo said.

"We have a relatively small market share, so it represents a growth opportunity for us," she said. "We're seeing an opportunity now, because our customers are more willing to outsource" their network operations to Lucent.