Motorola Loss Widens on Weak Phone SalesBy Reuters - | Posted 2008-04-24 Email Print
Motorola continues to struggle with quarterly numbers. Sales of mobile phones continue to be down for the third-largest phone maker.
NEW YORK (Reuters) - Motorola Inc (MOT.N: Quote, Profile, Research) said on Thursday its quarterly loss widened on disappointing cell phone sales, signaling further market share losses to Nokia (NOK1V.HE: Quote, Profile, Research) and other rivals sending shares down about 4 percent in early trading.
The company also missed Wall Street estimates on first quarter revenue and forecast a deeper-than-expected second quarter loss. Motorola plans to spin off its mobile devices business next year after more than a year of losses at the unit.
"We didn't expect much and we didn't get much," said American Technology Research analyst Mark McKechnie.
While Motorola's operating loss was slightly narrower than expected, McKechnie said that revenue for all three of Motorola's business units -- mobile devices, network equipment and enterprise mobility -- fell short of his expectations.
Motorola has struggled to come up with a successful phone since launching the Razr in late 2004. It has also failed to bolster its high-end line of handsets, even as it faces new competition from the likes of Apple Inc's (AAPL.O: Quote, Profile, Research) media-playing iPhone.
The company posted a loss of $194 million, or 9 cents per share compared with a loss of $181 million, or 8 cents a share a year ago.
Excluding a charge of 4 cents a share for job cuts and other items, Motorola's loss was 5 cents a share, a penny better than the average analyst forecast, according to Reuters Estimates.
The world's third biggest mobile phone maker said net sales fell to $7.45 billion from $9.43 billion. Analysts on average had expected revenue of $7.85 billion.
The Schaumburg, Illinois-based company sold 27.4 million phones in the quarter compared with 45.4 million in the year-ago quarter. Five analysts polled by Reuters had phone sale estimates ranging from 25 million to 31.7 million.
By comparison, market leader Nokia sold 115.5 million phones in the quarter. Samsung Electronics (005930.KS: Quote, Profile, Research), which stole the No. 2 spot from Motorola last year, has yet to report.
"(Motorola) missed across the board with not a great performance from any division but given the macro environment, their core business did OK," McKechnie said.