NEW YORK (CNNMoney.com) - Telecom equipment maker Nortel announced Friday that it will restate previously reported results and delay the filing of its year-end financial reports with U.S. and Canadian authorities.

The Toronto-based company said it will restate financial results for 2003, 2004 and the first three quarters of 2005. It will also make adjustments to periods prior to 2003, primarily due to revenue it nows says was incorrectly recognized in prior periods that should have been deferred to future periods.

"This revenue is real -- it was recognized in the wrong periods. The restatements do not affect the company's cash position," said a statement from CEO and President Mike Zafirovski.

The company said the restatement to result in 2003 seeing a drop in revenue of $157 million and a decline in income of $91 million, while 2004 will see revenue reduced by $77 million, while income should decline by $93 million. Its previously reported results for the first three quarters of 2005 will see revenue decline by $162 million and net earnings fall by $95 million.

"Although the need to restate certain financial statements is unfortunate, it's the right thing to do," said Zafirovski's statement. "The extensive contract review we undertook in 2005 underscores our commitment to ensure a solid foundation for this company going forward."

The company also announced preliminary results for the fourth quarter of 2005, saying it had a net loss of $2.21 billion, or 51 cents a share. That compares to a net loss of $107 million, or 2 cents a share a year earlier.

The net loss included special items of $2.5 billion, or 57 cents a share, which included an agreement reached in principle for the proposed settlement of certain shareholder class action litigation. That leaves income excluding special items of 6 cents a share in the quarter, or better than the 4 cents a share estimated by analysts surveyed by earnings tracker First Call.

The company also set new goals for operating income, saying it is targeting operating margin expansion in excess of $1.5 billion in 2008, including $200 million in cost savings from the previously initiated finance transformation.

Shares of Nortel (Research) fell 10 cents, or 3 percent, to $2.99 in pre-market trading immediately following the announcements.