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Exhibit 99.1 (NORTEL NEWS RELEASE BANNER) www.nortel.com FOR IMMEDIATE RELEASE May 18, 2005For more information:Media
    
    InvestorsBill Durling
    
    (888) 901-7286(905) 863-1078
    
    (905) 863-6049bdurling@nortel.com
    
    investor@nortel.com
 Nortel Provides Status Update TORONTO  Nortel Networks* Corporation [NYSE/TSX: NT] and its principal operating subsidiary
Nortel Networks Limited (NNL), today provided a status update pursuant to the alternative
information guidelines of the Ontario Securities Commission. These guidelines contemplate that the
Company and NNL will normally provide bi-weekly updates on their affairs until such time as they
are current with their filing obligations under Canadian securities laws. Management Appointments Nortel announced the appointment of Paul Karr as controller, effective May 4, 2005. As controller,
Karr is the chief architect and driver of strengthening the financial controls for the Company.
Karr leads a large, global finance team and is responsible for directing and improving the
organization and for the preparation of all external financial reporting in accordance with U.S.
generally accepted accounting principles. Karr is a seasoned finance executive and accounting expert who until recently was Vice President
and Financial Controller for Bristol-Myers Squibb Company in New York. He was specifically
recruited by Bristol-Myers Squibb to lead the financial function during a difficult restatement
process. Prior to his tenure at Bristol-Myers Squibb, Karr held a number of increasingly responsible
positions at GE Capital Market Services culminating in his role as Senior Vice President and Chief
Accounting Officer. Karr also spent fifteen years at Deloitte & Touche where he was promoted to
National Consultation Partner. A graduate of the University of Illinois, Urbana-Champaign, Karr holds both a Bachelor of Science
degree in Accounting, as well a Masters Degree Accounting from the university. Karr reports to executive vice-president and chief financial officer (CFO) Peter Currie. Karen
Sledge, who had been serving as interim controller since February 2005, is vice-president, finance
and continues to report to the CFO. Karr and Sledge have also been appointed controller and vice-president, finance, respectively, of
NNL. The Company and NNL reported that there have been no material developments in the matters reported
in their status updates of June 2, 2004 through May 2, 2005, with the exception of the matters
described above.
The Companys and NNLs next bi-weekly status update is expected to be released during the week of
May 30, 2005.




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About Nortel Nortel is a recognized leader in delivering communications capabilities that enhance the human
experience, ignite and power global commerce, and secure and protect the worlds most critical
information. Serving both service provider and enterprise customers, Nortel delivers innovative
technology solutions encompassing end-to-end broadband, Voice over IP, multimedia services and
applications, and wireless broadband designed to help people solve the worlds greatest challenges.
Nortel does business in more than 150 countries. For more information, visit Nortel on the Web at
www.nortel.com. For the latest Nortel news, visit www.nortel.com/news. Certain information included in this press release is forward-looking and is subject to
important risks and uncertainties. The results or events predicted in these statements may differ
materially from actual results or events. Factors which could cause results or events to differ
from current expectations include, among other things: the outcome of regulatory and criminal
investigations and civil litigation actions related to Nortels restatements and the impact any
resulting legal judgments, settlements, penalties and expenses could have on Nortels results of
operations, financial condition and liquidity, and any related potential dilution of Nortels
common shares; the findings of Nortels independent review and implementation of recommended
remedial measures; the outcome of the independent review with respect to revenues for specific
identified transactions, which review will have a particular emphasis on the underlying conduct
that led to the initial recognition of these revenues; the restatement or revisions of Nortels
previously announced or filed financial results and resulting negative publicity; the existence of
material weaknesses in Nortels internal control over financial reporting and the conclusion of
Nortels management and independent auditor that Nortels internal control over financial reporting
is ineffective, which could continue to impact Nortels ability to report its results of operations
and financial condition accurately and in a timely manner; the impact of Nortels and NNLs failure
to timely file their financial statements and related periodic reports, including breach of its
support facility and public debt obligations and Nortels inability to access its shelf
registration statement filed with the United States Securities and Exchange Commission (SEC);
ongoing SEC reviews, which may result in changes to our public filings; the potential delisting or
suspension of Nortels and NNLs publicly traded securities; the impact of management changes,
including the termination for cause of Nortels former CEO, CFO and Controller in April 2004; the
sufficiency of Nortels restructuring activities, including the work plan announced on August 19,
2004 as updated on September 30, 2004 and December 14, 2004, including the potential for higher
actual costs to be incurred in connection with restructuring actions compared to the estimated
costs of such actions; cautious or reduced spending by Nortels customers; increased consolidation
among Nortels customers and the loss of customers in certain markets; fluctuations in Nortels
operating results and general industry, economic and market conditions and growth rates;
fluctuations in Nortels cash flow, level of outstanding debt and current debt ratings; Nortels
monitoring of the capital markets for opportunities to improve its capital structure and financial
flexibility; Nortels ability to recruit and retain qualified employees; the use of cash collateral
to support Nortels normal course business activities; the dependence on Nortels subsidiaries for
funding; the impact of Nortels defined benefit plans and deferred tax assets on results of
operations and Nortels cash flow; the adverse resolution of class actions, litigation in the
ordinary course of business, intellectual property disputes and similar matters; Nortels
dependence on new product development and its ability to predict market demand for particular
products; Nortels ability to integrate the operations and technologies of acquired businesses in
an effective manner; the impact of rapid technological and market change; the impact of price and
product competition; barriers to international growth and global economic conditions, particularly
in emerging markets and including interest rate and currency exchange rate fluctuations; the impact
of rationalization and consolidation in the telecommunications industry; changes in regulation of
the Internet; the impact of the credit risks of Nor
tels customers and the impact of customer
financing and commitments; stock market volatility generally and as a result of acceleration of the
settlement date or early settlement, which is currently not available, of Nortels forward purchase
contracts; negative developments associated with Nortels supply contracts and contract
manufacturing agreements, including as a result of using a sole supplier for a key component of
certain Optical Networks solutions; the impact of Nortels supply and outsourcing contracts that
contain delivery and installation provisions, which, if not met, could result in the payment of
substantial penalties or liquidated damages; and the future success of Nortels strategic
alliances. For additional information with respect to certain of these and other factors, see the
most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed by Nortel 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. -end- *Nortel, the Nortel logo and the Globemark are trademarks of Nortel.