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Exhibit 99.1 News Release
    
    (NORTEL LOGO)
 www.nortel.com FOR IMMEDIATE RELEASE
    
    May 31, 2005For more information:Media
Bill Durling
(905) 863-1078bdurling@nortel.com
    
    Investors
(888) 901-7286
(905) 863-6049investor@nortel.com
 Nortel Files First Quarter 2005 Financial Statements TORONTO  Nortel Networks* Corporation [NYSE/TSX: NT] today announced that it and its
principal operating subsidiary, Nortel Networks Limited (NNL), have filed their unaudited
financial statements for the first quarter of 2005 prepared in accordance with accounting
principles generally accepted in the United States, and related Quarterly Reports on Form 10-Q and
corresponding Canadian filings. The Company will issue a press release (which will serve as its and
NNLs status update pursuant to the alternative information guidelines of the Ontario Securities
Commission) and then hold a conference call at 8:30 a.m. ET on Wednesday, June 1, 2005 to discuss
the first quarter of 2005 results. The details of the call are provided below. 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 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 Nortels and NNLs
public filings; 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




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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 Nortels customers and the impact of customer financing and commitments; stock market volatility
generally and as a result of acceleration of the settlement date 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 onForm 10-Kand Quarterly Report onForm 10-Qfiled 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. Nortel will host a teleconference/audio webcast to discuss First Quarter 2005 Results. TIME:          8:30 AM  9:30 AM ET on Wednesday, June 1, 2005 To participate, please call the following at least 15 minutes prior to the start of the event. Teleconference:
North America:
International:
    
    888-211-4395
212-231-6007
    
    Webcast:http://www.nortel.com/q12005earnings
 Replay:
(Available one hour after the conference call until 5 :00 p.m. ET, June 14, 2005) North America :
International :
Webcast:
    
    800-383-0935
402-530-5545http://www.nortel.com/q12005earnings
    
    Passcode :
Passcode :
    
    21248030#
21248030#