Hey, Joe Fool! Your spinster Aunt Alcatel (NYSE:ALA) -- remember, the one who moved to Paris with her five cats last year? -- called this morning with some bad news. She won't be able to send that dividend check you were expecting. Money's a little tight this year, but she'll see whether she can save up a little something to send you next year.

That's the big news that has French telecom equipment maker Alcatel down 13% today. The lesser news, strangely, doesn't seem so bad. For the year, sales increased less than 6% against fiscal 2003. But if not for the declining value of the U.S. dollar dragging down results (by making each dollar of revenues translate into fewer and fewer euros), sales would have increased by nearly 10%.

As for profits -- well, they were pretty good this year, relatively speaking. Last year, the company posted losses equivalent to $1.97 per U.S.-traded American Depositary Receipt. This year, the company reversed that and earned a profit of $0.28. What's more, it claims to have generated positive free cash flow for fiscal 2004, although it didn't provide a hard number.

Even the other "bad" news of the day wasn't so bad, objectively speaking. For one thing, Alcatel managed to boost its gross margins by a full 190 basis points over last year, to 37.3%. While that's still short of the kinds of margins that competitors Lucent (NYSE:LU) and Ericsson (NASDAQ:ERICY) pull down, an improvement's an improvement, right? And that 37.3% margin still far outclasses Alcatel's cross-border rival Siemens (NYSE:SI), giving the French some continental bragging rights.

Finally, looking toward the future, Alcatel advised that it's targeting 3%-5% revenue growth and double-digit earnings growth in fiscal 2005. The revenue growth number is about half of what Wall Street had been hoping to hear, and that helps explain the outsized sell-off this morning, but double-digit earnings growth in the troubled telecom equipment sector is really nothing to complain about. I'm sure that shareholders of peers JDS Uniphase (NASDAQ:JDSU) and Ciena (NASDAQ:CIEN), both of whom have had trouble finding any recent signs of profits in their companies, would happily trade in, say, Ciena's 16% revenue gains for even single-digit profits growth.

What else is new in the world of telecom? Read the following and find out.

Want to know which companies will actually pay your promised dividends? Take a free trial to Motley Fool Income Investor .

Fool contributor Rich Smith holds no position in any company mentioned in this article.