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LTW, AP

RESEARCH TRIANGLE PARK, N.C. – finished 2009 with a profit through its liquidation of most corporate assets under bankruptcy protection and cost cutting.

The company, which still maintains a presence in RTP, reported Friday a profit of $488 million, or 96 cents a share. Revenue fell to $4.09 billion from $7.62 billion, but in 2008 before declaring bankruptcy Nortel reported a loss of $5.8 billion.

For the fourth quarter, Nortel said it made $1.78 billion, but $1.3 billion of that came from the sale of its wireless CDMA technology unit to Ericsson.

Revenue from product sales fell to $794 million from $2.07 billion a year earlier, a drop of 62 percent.

Highlights from Nortel’s earnings report:

• “Revenues in the fourth quarter of $794 million, with declines year over year in all segments and in all regions. These revenues exclude fourth quarter revenues related to Equity Investees of $367 million and $300 million related to discontinued operations. Full year revenues were $4.09 billion, with declines year over year in all segments and in all regions. These revenues exclude full year revenues related to Equity Investees of $1.46 billion and $1.37 billion related to discontinued operations. Total revenues were $2.07 billion in the fourth quarter of 2008 and $7.62 billion for the full year 2008, excluding revenues related to discontinued operations of $650 million in the fourth quarter of 2008 and $2.80 billion for the full year 2008.
• “Gross margin of 38.3 percent in the fourth quarter, a decrease of 2.7 percentage points from the year ago quarter, and full year gross margin of 42.4 percent, an increase of 1.0 percentage point from full year 2008, includes charges related to workforce and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges. Excluding these charges, gross margin would have been 39.4 percent (a) for the fourth quarter of 2009 and 43.5 percent (a) for the full year 2009.
• “SG&A expense in the fourth quarter of $158 million, a decrease of 32.2 percent from the year ago quarter and SG&A expense for the full year of $698 million, a decrease of 39.4 percent from 2008. Excluding $13 million for the fourth quarter and $67 for the full year related to workforce and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges, SG&A for the fourth quarter would have decreased by 37.8 percent year over year (a) and for the full year would have decreased 45.2 percent from 2008(a). SG&A expense in the fourth quarter and full year excludes $112 million and $511 million respectively related to Equity Investees.
• “R&D expense in the fourth quarter of $149 million, a decrease of 36.9 percent from the year ago quarter and R&D expense for the full year of $757 million, a decrease of 33.7 percent from 2008. Excluding $13 million for the fourth quarter and $41 for the full year related to workforce and other cost reduction activities and pension curtailment losses that historically would have been recorded in special charges, SG&A for the fourth quarter would have decreased by 43.2 percent year over year (a) and for the full year would have decreased 37.2 percent from 2008(a). R&D expense in the fourth quarter and full year excludes $16 million and $118 million respectively related to Equity Investees.
• “Cash balance as of December 31, 2009 was $2.0 billion and excluded Equity Investees cash of $815 million and restricted cash of $1,928 related to divestiture proceeds. The consolidated cash balance exceeded the September 30, 2009 consolidated cash balance of $1.81 billion, which excluded Equity Investees cash of $798 million. “

The earnings report is available