Nortel warns of need to cut costs

Nortel Networks has warned that it will have to cut costs if it is to reach its full-year performance targets and said that it will announce an improved cost structure when it releases its first and second quarter financial results next month. The vendor is currently under investigation for accounting irregularities and working on the restatement of its results for various periods between 2001 and 2003. Shares in Nortel fell 8% as a result of the warning announcement.