Nortel Networks has reported a net income of $499m (£276m) for the fourth quarter of 2003.
Revenue for the telecommunications and enterprise network supplier was $2.83bn (£1.6bn), compared with $2.53bn in the fourth quarter of 2002.
Revenue grew even more sequentially, from $2.27bn in the third quarter of 2003.
For the full year, Nortel reported net income of $732m (£404m) compared with a loss of $3.27bn in 2002. The stronger results came on less revenue, with $9.81bn in revenue for 2003 compared with $10.57bn in 2002.
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"This is truly a watershed time. We had a remarkable quarter and a great year," said president and chief executive officer Frank Dunn.
It was the company's first yearly profit in six years, he said.
Nortel is confident on the emergence of VoIP technology in both enterprise and carrier networks, as well as on high-speed wireless data networks.
"People are going to deploy this technology in 2004 and people will deploy and offer networks of Wideband CDMA (code division multiple access) in 2004," Dunn said.
Nortel is also working with the Massachusetts Institute of Technology on a trial of a public wireless Lan technology that could significantly cut service providers' cost of network deployment, he said.
Wireless network sales dominated the company's quarterly revenue gains from a year earlier, with growth of 33% in that segment.
Landline networks revenue increased 9%, while enterprise networks fell 2% and optical network revenue declined 18%.
Revenue grew from the previous year's fourth quarter in the US, with a 26% gain, Canada with 48%, and the Caribbean and Latin America with 27%. It fell 5% in Europe, the Middle East and Africa and 25% in the Asia-Pacific region.
Dunn said he expected the Asia-Pacific market to rebound this year.
While the overall market for enterprise networks should grow as much as 5% in 2004, the carrier equipment industry is likely to grow slightly more than 5%.
Stephen Lawson writes for IDG News Service