8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 8-K

CURRENT REPORT PURSUANT TO

SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 19, 2005

AVAYA INC.

(Exact name of registrant as specified in its charter)

Delaware	1-15951	22-3713430
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
211 Mount Airy Road Basking Ridge, NJ		07920
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (908) 953-6000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

In accordance with SEC Release No. 33-8126, the following information is furnished under Item 2.02, “Results of Operations and Financial Condition.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On April 19, 2005, Avaya Inc. (the “Company”) issued a press release reporting financial results for the fiscal quarter ended March 31, 2005 and held a public webcast in connection with the issuance of the press release.  A copy of the charts related to such presentation and certain reconciliation and other information is attached as Exhibit 99.1 hereto and incorporated into this Form 8-K by reference.  These materials are also available on the Avaya investor relations website at http://investors.avaya.com/.

Item 9.01. Financial Statements and Exhibits.

(c)          Exhibits.

99.1         Presentation of Avaya Inc. dated April 19, 2005

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	AVAYA INC.
Date:  April 20, 2005	By:	/s/ Garry K. McGuire
			Name:	Garry K. McGuire
			Title:	Chief Financial Officer and Senior Vice President, Corporate Development

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EXHIBIT INDEX

EXHIBIT NUMBER	DESCRIPTION
99.1	Presentation of Avaya Inc. dated April 19, 2005.

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EX-99.1

Exhibit 99.1

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[LOGO]

Q2 FY2005
Earnings Conference Call

April 19, 2005

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Forward Looking Statement

The use of words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “intends,” “future,” “potential,” or “continue,” the negative of these terms and other comparable terminology are intended to identify forward-looking statements.

These statements are only predictions based on our current expectations and projections about future events. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements.

In this regard, you should specifically consider the numerous risks outlined in our SEC filings.

Presentation

Unless indicated otherwise, all results are presented in accordance with United States generally accepted accounting principles (GAAP).

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Building Shareholder Value

Profitable Growth

Strategic Differentiation

Global Reach

Financial Strength

Operating Leverage

Technology Transition

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Q2 FY2005 Results

Financial Summary

•Revenues grew 21% year over year including the impact of acquisitions

•Product sales up 9.7%

•Rental and managed services up $115M

•Services up 11.9%

•Tenovis revenue was $237M for the quarter

•Excluding Tenovis revenue was $985M, down 2% year over year

•Gross margin was 46.1%, down ..7 from a year ago and 1.2 sequentially

•Operating income declined from $60M to $52M including Tenovis dilution of $28M

•Operating margin was 4.3%

•Cash position remained strong at $855M

•Debt decreased by $180M to $188M

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Revenue

Quarterly trend

[CHART]

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Gross and Operating Margins

Gross Margin ($M)

[CHART]

	Q2 FY04		Q3 FY04		Q4 FY04		Q1 FY05		Q2 FY05
($)	471		488		538		543		563
%	46.8	%	48.0	%	50.0	%	47.3	%	46.1	%

Operating Income ($M)

[CHART]

	Q2 FY04		Q3 FY04		Q4 FY04		Q1 FY05		Q2 FY05
($)	60		92		119		88		52
%	6.0	%	9.1	%	11.1	%	7.7	%	4.3	%

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Segment Results

Global Communications Solutions

Revenue ($M)

[CHART]

	Q2 FY04	Q3 FY04	Q4 FY04	Q1 FY05	Q2 FY05
Revenue	493	506	565	592	625

Q2 FY05 Segment Highlights

•Revenue increased 26.8% vs. a year ago, largely attributed to Tenovis

•Excluding Tenovis sales were flat vs. a year ago

•Gross margins improved due to greater efficiencies in manufacturing and higher percentage of software in product

•Operating losses reported primarily due to the dilutive impact of Tenovis

Operating Income (Loss) ($M)

[CHART]

	Q2 FY04		Q3 FY04		Q4 FY04		Q1 FY05		Q2 FY05
($)	(3	)	17		55		25		(12	)
%	(0.6	)%	3.4	%	9.7	%	4.2	%	(1.9	)%

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Avaya Global Services

Revenue ($M)

[CHART]

	Q2 FY04	Q3 FY04	Q4 FY04	Q1 FY05	Q2 FY05
Revenue	511	510	511	556	597

Q2 FY05 Segment Highlights

•Revenue increased 16.8% vs. a year ago, attributed to Tenovis

•Maintenance, implementation and integration and rental and managed services increased year over year

•U.S. service revenue declined

•Operating margin was down due to the decrease in U.S. revenue and higher fixed costs in the U.S. coupled with the dilution from Tenovis

Operating Income ($M)

[CHART]

	Q2 FY04		Q3 FY04		Q4 FY04		Q1 FY05		Q2 FY05
($)	63		68		65		56		27
%	12.3	%	13.3	%	12.7	%	10.1	%	4.5	%

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Cash Flows

Six Months Ended March 31, 2005

	($ in millions)
Net Cash Provided by Operating Activities	$	60
Net Cash Used in Investing Activities	(450		)
Net Cash Used in Financing Activities	(380		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	8
Net Decrease in Cash and Cash Equivalents	(762		)
Cash and Cash Equivalents as of 9/30/04	1,617
Cash and Cash Equivalents as of 3/31/05	$	855

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Balance Sheet

Cash

[CHART]

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Debt

[CHART]

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Net Cash*

[CHART]

Strong Net Cash Position

•Decrease of only $120 million year over year

•Significantly paid down debt

•Cash outlay for acquisitions of $409M, net of cash in those business

*Net Cash is defined as cash and cash equivalents less total debt. At 3/31/05 this amount is calculated as cash and cash equivalents of $855M less total debt of $188M

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Days Sales Outstanding

DSO (1-point Method)

[CHART]

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[LOGO]

Q2 FY2005
Earnings Conference Call

April 19, 2005

[LOGO]

Supplemental
Information

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Reconciliations for Comparative Purposes

(in $ millions)	Six Months Ended								Three Months Ended								Three Months Ended
	March 31,						%		March 31,						%		March 31,		December 31,		%
	2005			2004			Growth		2005			2004			Growth		2005		2004		Growth
Revenue
As Reported	$	2,370		$	1,977		20	%	$	1,222		$	1,006		21	%	$	1,222	$	1,148	6.0	%
Tenovis	361			—			18	%	237			—			24	%	237		124		—
Excluding Tenovis	$	2,009		$	1,977		2	%	$	985		$	1,006		(2	)%	$	985	$	1,024	(4.0	)%
Operating income
As Reported	$	140		$	112		25	%	$	52		$	60		(13	)%
Tenovis	(35		)	—			(31	)%	(28		)	—			(47	)%
Excluding Tenovis	$	175		$	112		56	%	$	80		$	60		33	%
Operating Margin
As Reported	5.9		%	5.7		%			4.3		%	6.0		%
Tenovis	(9.7		)%	—					(11.8		)%	—
Excluding Tenovis	8.7		%	5.7		%			8.1		%	6.0		%

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	Three Months Ended March 31,
	2005			2004
Diluted Earnings Per Share
As Reported	$	0.07		$	0.22
Less: Results of Tenovis Operations	(0.06		)	—
Favorable Settlement of Certain Tax Matters	—			0.19
Loss on Senior Secured Notes Extinguishment	—			(0.05		)
Loss on Sale of CommScope Common Shares	—			(0.01		)
	$	0.13		$	0.09

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