Exhibit 99.1

www.nortel.com
FOR IMMEDIATE RELEASE:		March 12, 2010

For more information:

Jamie Moody

972-684-7167

moodyjam@nortel.com

Nortel Reports Financial Results for the Fourth Quarter and Full Year 2009

Financial Presentation

Financial Results

TORONTO—Nortel* Networks Corporation [OTC: NRTLQ] announced its results for the fourth quarter and full year 2009. Results were prepared in accordance with United States generally accepted accounting principles (GAAP) in U.S. dollars.

As previously announced on November 16, 2009, following discussions with the U.S. Securities and Exchange Commission (SEC), Nortel no longer combines the results of the Europe, Middle East and Africa (EMEA) subsidiaries, and entities they control (Equity Investees), with its consolidated results. Nortel has determined that, as of the Petition Date, it is appropriate to present its Equity Investees under the equity method of accounting based on the conclusion that Nortel exercises significant influence over those entities. The equity method of accounting results in the financial position and results of operations of the Equity Investees being presented net on a single line in the balance sheet and statement of operations, respectively,

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versus being combined gross into each individual line item. The comparative periods have not been recast for this change in presentation. As a result, analysis using the comparative periods may be difficult, and may not provide meaningful comparisons.

The Enterprise Solutions (ES) business as well as the Nortel Government Solutions (NGS) and DiamondWare businesses are presented as discontinued operations for the fourth quarter and year ended December 31, 2009. Accordingly, comparative periods have been recast to give effect for the change in accounting.

The Code Division Multiple Access (CDMA) business did not qualify for treatment as discontinued operations and as a result is included in continuing operations.

Except in the Segment Revenues section, the discussion below relates to Results from Continuing Operations under U.S. GAAP and excludes the financial results of the Equity Investees. Consistent with the way we manage our business segments, the financial information in the Segment Revenues section includes the results from continuing operations of the Equity Investees within each segment. Therefore, in order to reconcile the financial information for the business segments discussed below to our consolidated financial information, the net financial results of the Equity Investees must be removed.

As part of Nortel’s ongoing cost reduction activities, on March 11, 2010, Nortel Networks Corporation (NNC), Nortel Networks Limited (NNL), Nortel Networks Inc. and Nortel Networks Capital Corporation each filed a Form 15 related to their respective debt securities and all related guarantees, as applicable, reflecting the automatic suspension of reporting requirements under the U.S. Securities Exchange Act of 1934 (Act) as there were less than 300 holders of each series of securities as of January 1, 2010. NNL also intends to terminate the registration of its common stock under the Act shortly and suspend its obligations to file periodic reports with the SEC, including Forms 10-K, 10-Q and 8-K. Following the deregistration of its common shares, NNL will continue to be a “reporting issuer” under Canadian securities laws and, as a result, will remain subject to continuous disclosure requirements, including the filing of annual and quarterly financial statements and managements’ discussion and analysis of financial results under applicable Canadian securities laws. NNC will continue to be a “reporting issuer” under both Canadian and U.S. securities laws and will continue to remain subject to applicable continuous disclosure requirements.

Financial Summary

Nortel’s overall financial performance in the fourth quarter of 2009 was impacted by continued ongoing negative economic conditions and the uncertainty created by the Company’s Creditor Protection Proceedings which resulted in a decrease in customers’ spending levels, as well as the sale of the CDMA/LTE Access and Enterprise, NGS and DiamondWare businesses in December 2009.

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Segment Revenues

The financial information for our business segments includes the results of the Equity Investees as if they were consolidated, which is consistent with the way we manage our business segments, but does not include the results of discontinued operations. Commencing with the third quarter of 2009, Nortel began reporting its CVAS business unit as a separate reportable segment. Prior to that time, the results of CVAS were included in the Wireless Networks (WN) reportable segment, which prior to the third quarter of 2009 was called the Carrier Networks (CN) reportable segment.

Segment revenues were $1.1 billion for the fourth quarter of 2009 compared to $2.07 billion for the fourth quarter of 2008, reflecting a reduction of 49.2% percent due to declines across all business segments. The reduction was primarily a result of the continuing economic downturn, the uncertainty created by the Creditor Protection Proceedings, the recognition of previously deferred revenue in the fourth quarter of 2008 not repeated to the same extent in the fourth quarter of 2009 and the divestitures of the CDMA/LTE Access and Enterprise businesses in the fourth quarter of 2009.

Segment Revenues B/(W)

WN revenues in the fourth quarter of 2009 were $375 million, a decrease of 67% percent compared with the year ago quarter and a decrease of 43% sequentially with declines in the GSM and UMTS solutions business and the CDMA solutions business. CDMA solutions revenues were impacted by the divestiture of the CDMA business in the fourth quarter of 2009. The wireless segment was also negatively impacted by a reduction in spending by certain customers as a result of their change in technology migration plans.

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CVAS revenues in the fourth quarter of 2009 were $194 million, a decrease of 27% percent compared with the year ago quarter and a decrease of 7% sequentially primarily due to lower sales volumes.

Metro Ethernet Networks (MEN) revenues in the fourth quarter of 2009 were $327 million, a decrease of 29% percent compared with the year ago quarter and an increase of 11% sequentially. In addition to the overall factors above, lower revenues from certain customers also impacted the year over year decline.

LG-Nortel Co. Ltd. (LGN) revenues in the fourth quarter of 2009 were $154 million, a decrease of 24% percent compared with the year ago quarter and an increase of 50% sequentially. In addition to the overall factors described above, a majority of the year over year decline was in LGN Carrier, primarily due to higher sales volumes related to our 3G wireless products in the fourth quarter of 2008. The decrease was partially offset by network upgrades related to certain customers in the fourth quarter of 2009, as well as the impact of foreign exchange fluctuations.

Discontinued operations revenues in the fourth quarter of 2009 were $410 million, a decrease of 37% percent compared with the year ago quarter and a decrease of 14% sequentially. These reductions were primarily due to the divesture of the ES, NGS and DiamondWare businesses in the fourth quarter of 2009.

Gross Margin

Gross margin was 38.3 percent of revenues in the fourth quarter of 2009. Excluding charges related to workforce and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges, gross margin in the fourth quarter of 2009 would have been 39.4 percent ^(a) of revenues. This compared to gross margin of 41.0 percent for the fourth quarter of 2008 and 45.0 percent for the third quarter of 2009. Compared to the fourth quarter of 2008, in addition to the items already noted, gross margin decreased primarily as a result of the unfavorable impacts of product mix, foreign exchange fluctuations and price erosion.

Operating Expenses

Operating Expenses B/(W)

A focus on reducing costs resulted in lower operating expenses compared to the year ago quarter. Operating expenses were $307 million in the fourth quarter of 2009 and $339 million for the third quarter of 2009. This compares to operating expenses of $469 million for the fourth quarter of 2008.

SG&A expenses were $158 million in the fourth quarter of 2009, compared to $233 million for the fourth quarter of 2008 and $155 million for the third quarter of 2009. Excluding charges related to workforce and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges, SG&A expenses for the fourth quarter of 2009 would have been $145 million ^(a). SG&A expense in the fourth quarter of 2009 excludes $112 million related to Equity Investees. Compared to the fourth quarter of 2008, in addition to the items already noted, SG&A was favorably impacted primarily by headcount reductions and lower spending levels across all categories including a reduction in sales and marketing investment in maturing technologies.

R&D expenses were $149 million in the fourth quarter of 2009, compared to $236 million for the fourth quarter of 2008 and $184 million for the third quarter of 2009. Excluding charges related to workforce and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges, R&D expenses for the fourth quarter of 2009 would have been $136 million ^(a). R&D expense in the

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fourth quarter of 2009 excludes $16 million related to Equity Investees. Compared to the fourth quarter of 2008, in addition to the items already noted, R&D was favorably impacted primarily by headcount reductions and the cancellation of certain R&D programs.

Net Earnings (Loss)

The Company reported net earnings in the fourth quarter of 2009 of $1.78 billion compared to a net loss of $2.14 billion in the fourth quarter of 2008 and a net loss of $508 million in the third quarter of 2009.

The net earnings in the fourth quarter of 2009 of $1.78 billion included a gain from discontinued operations of $689 million primarily related to the divestiture of the ES business to Avaya of $756 million, reorganization items of $1,263 million primarily related to the gain on the divestiture of the CDMA/LTE Access assets to Ericsson of $1,202, interest expense of $74 million, other charges of $59 million comprised in part by pension curtailment expense, $75 million in income tax expense and an expense of $1 million for earnings attributable to non-controlling interests (formerly minority interests), partially offset by other income – net of $35 million, comprised in part of a currency exchange gain of $18 million.

The net loss in the fourth quarter of 2008 of $2.14 billion included $959 million in income tax expense primarily attributable to the increase in valuation allowance against net deferred tax assets, a goodwill impairment charge of $910, loss from discontinued operations of $430, interest expense of $85 million, special charges of $85 million for headcount and other cost reduction activities, earnings of $2 million for earnings attributable to non-controlling interests (formerly minority interests) and other expense – net of $43 million, comprised primarily of a loss of $46 million due to changes in foreign exchange rates.

Cash

Consolidated cash balance as of December 31, 2009 was $2.0 billion and excluded Equity Investees cash of $815 million. The consolidated cash balance exceeded the September 30, 2009 consolidated cash balance of $1.8 billion, which excluded Equity Investees cash of $798 million. The increase in the consolidated cash balance was primarily due to: cash from operating activities of $114 million; cash provided by investing activities of $75 million mainly due to proceeds from sales of business offset by changes in restricted cash including restricted cash of $1,928 related to divestiture proceeds; partially offset by cash used in financing activities of $46 million primarily related to a capital repayment and net unfavorable foreign exchange impacts of $1 million.

Full Year 2009 Results

For 2009, revenues were $4.09 billion compared to $7.62 billion for 2008. Nortel reported net earnings for 2009 of $488 million, compared to net loss of $5.80 billion for the year 2008.

Net loss for 2009 included the amortization of intangibles of $13 million, reorganization items of $979 million primarily related to the gain on the divestiture to Ericsson, income tax expense of $75 million, a currency exchange gain of $38 million, and net earnings from discontinued operations of $201 primarily related to the gain on the divestiture to Avaya of $756 million.

Net loss for 2008 included the amortization of intangibles of $21 million, special charges of $251 million, a gain on sale of business and assets of $11 million, a litigation settlement expense of $11 million, a currency exchange loss of $38 million, M&A related costs of $9 million, an investment impairment of $8 million, income tax expense of $3,193 million, a goodwill write-down of $1,571 million and a net loss from discontinued operations of $1,175.

As previously announced, Nortel does not expect that the Company’s common shareholders or the NNL preferred shareholders will receive any value from the creditor protection proceedings and expects that the proceedings will result in the cancellation of these equity interests.

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* * * * * *

(a) Each of Gross Margin, SG&A Expense and R&D Expense, excluding the impact of charges in relation to headcount and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges, are non-GAAP measures. Nortel’s management believes that these measures are meaningful measurements of operating performance and provide greater transparency to investors with respect to Nortel’s performance and supplemental information used by management in its financial and operational decision making. These non-GAAP measures may also facilitate comparisons to Nortel’s historical performance and competitors’ operating results. These non-GAAP measures should be considered in addition to, but not as a substitute for, the information contained in Nortel’s financial statements prepared in accordance with GAAP. These measures may not be synonymous to similar measurement terms used by other companies.

About Nortel

For more information, visit Nortel on the Web at www.nortel.com. For the latest Nortel news, visit www.nortel.com/news.

Certain statements in this press release may contain words such as “could”, “expects”, “may”, “should”, “will”, “anticipates”, “believes”, “intends”, “estimates”, “targets”, “plans”, “envisions”, “seeks” and other similar language and are considered forward-looking statements or information under applicable securities laws. These statements are based on Nortel’s current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Nortel operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. Nortel’s assumptions, although considered reasonable by Nortel at the date of this press release, may prove to be inaccurate and consequently Nortel’s actual results could differ materially from the expectations set out herein.

Actual results or events could differ materially from those contemplated in forward-looking statements as a result of the following: (i) risks and uncertainties relating to the Creditor Protection Proceedings including: (a) risks associated with Nortel’s ability to: stabilize the business and maximize the value of Nortel’s businesses; obtain required approvals and successfully consummate pending and future divestitures; ability to satisfy transition services agreement obligations in connection with divestiture of operations; successfully conclude ongoing discussions for the sale of Nortel’s other assets or businesses; develop, obtain required approvals for, and implement a court approved plan; resolve ongoing issues with creditors and other third parties whose interests may differ from Nortel’s; generate cash from operations and maintain adequate cash on hand in each of its jurisdictions to fund operations within the jurisdiction during the Creditor Protection Proceedings; access the EDC Facility given the current discretionary nature of the facility, or arrange for alternative funding; if necessary, arrange for sufficient debtor-in-possession or other financing; continue to have cash management arrangements and obtain any further required approvals from the Canadian Monitor, the U.K. Administrators, the French Administrator, the Israeli Administrators, the U.S. Creditors’ Committee, or other third parties; raise capital to satisfy claims, including Nortel’s ability to sell assets to satisfy claims against Nortel; maintain R&D investments; realize full or fair value for any assets or business that are divested; utilize net operating loss carryforwards and certain other tax attributes in the future; avoid the substantive consolidation of NNI’s assets and liabilities with those of one or more other U.S. Debtors; attract and retain customers or avoid reduction in, or delay or suspension of, customer orders as a result of the uncertainty caused by the Creditor Protection Proceedings; maintain market share, as competitors move to capitalize on customer concerns; operate Nortel’s business effectively under the new organizational structure, and in consultation with the Canadian Monitor, the U.S. Creditors’ Committee and the U.S. Principal Officer and work effectively with the U.K. Administrators, French Administrator and Israeli Administrators in their respective administration of the EMEA businesses subject to the Creditor Protection Proceedings; continue as a going concern; actively and adequately communicate on and respond to events, media and rumors associated with the Creditor Protection Proceedings that could adversely affect Nortel’s relationships with customers, suppliers, partners and employees; retain and incentivize key employees; retain, or if necessary, replace major suppliers on acceptable terms and avoid disruptions in Nortel’s supply chain; maintain current relationships with reseller partners, joint venture partners and strategic alliance partners; obtain court orders or approvals with respect to motions filed from time to time; resolve claims made against Nortel in connection with the Creditor Protection Proceedings for amounts not exceeding Nortel’s recorded liabilities subject to compromise; prevent third parties from obtaining court orders or approvals that are contrary to Nortel’s interests; reject, repudiate or terminate contracts; and (b) risks and uncertainties associated with: limitations on actions against any Debtor during the Creditor Protection Proceedings; the values, if any, that will be prescribed pursuant to any court approved plan to outstanding Nortel securities and, in particular, that Nortel does not expect that any value will be prescribed to the NNC common shares or the NNL preferred shares in any such plan; the delisting of NNC common shares from the NYSE; and the delisting of NNC common shares and NNL preferred shares from the TSX; and (ii) risks and uncertainties relating to Nortel’s business including: the sustained economic downturn and volatile market conditions and resulting negative impact on Nortel’s business, results of operations and financial position and its ability to accurately forecast its results and cash position; cautious capital spending by customers as a result of factors including current economic uncertainties; fluctuations in foreign currency exchange rates; any requirement to make larger contributions to defined benefit plans in the future; a high level of debt, arduous or restrictive terms and conditions related to accessing certain sources of funding; the sufficiency of workforce and cost reduction initiatives; any negative developments associated with Nortel’s suppliers and contract manufacturers including Nortel’s reliance on certain suppliers for key optical networking solutions components and on one supplier for most of its manufacturing and design functions; potential penalties, damages or cancelled customer contracts from failure to meet contractual obligations including delivery and installation deadlines and any defects or errors in Nortel’s current or planned products; significant competition, competitive pricing practices, industry consolidation, rapidly changing technologies, evolving industry standards, frequent new product introductions and short product life cycles, and other trends and industry characteristics affecting the telecommunications industry; any material, adverse affects on Nortel’s performance if its expectations regarding market demand for particular products prove to be wrong; potential higher operational and financial risks associated with Nortel’s international operations; a failure to protect Nortel’s intellectual property rights; any adverse legal judgments, fines, penalties or settlements related to any significant pending or future litigation actions; failure to maintain integrity of Nortel’s information systems; changes in regulation of the Internet or other regulatory changes; and Nortel’s potential inability to maintain an effective risk management strategy.

For additional information with respect to certain of these and other factors, see Nortel’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the SEC. Unless otherwise required by applicable securities laws, Nortel disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

*Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks.

Note that Nortel will not be hosting a teleconference/audio webcast to discuss fourth quarter 2009 results.

NORTEL NETWORKS CORPORATION

(Under Creditor Protection Proceedings as of January 14, 2009)

Condensed Consolidated Statements of Operations (unaudited)

(U.S. GAAP; Millions of U.S. dollars, except per share amounts)

NORTEL NETWORKS CORPORATION

(Under Creditor Protection Proceedings as of January 14, 2009)

Condensed Consolidated Balance Sheets (unaudited)

(U.S. GAAP; Millions of U.S. dollars, except per share amounts)

NORTEL NETWORKS CORPORATION

(Under Creditor Protection Proceedings as of January 14, 2009)

Condensed Consolidated Statements of Cash Flows

(U.S. GAAP; Millions of U.S. dollars)

NORTEL NETWORKS CORPORATION

(Under Creditor Protection Proceedings as of January 14, 2009)

Consolidated Financial Information (unaudited)

(U.S. GAAP; Millions of U.S. dollars)

Segmented revenues

The following table summarizes our revenue and management operating margin by segment. The financial information for our business segments includes the results of the Equity Investees as if they were consolidated, which is consistent with the way we manage our business segments.