Investor Pressure

By Reuters -  |  Posted 2008-04-24 Email Print this article Print
 
 
 
 
 
 
 

Motorola continues to struggle with quarterly numbers. Sales of mobile phones continue to be down for the third-largest phone maker.


INVESTOR PRESSURE

Motorola recently ended a proxy fight with major shareholder Carl Icahn after it agreed to allow two of his proposed slate of directors onto the board, but still faces investor pressure to turn its businesses around.

Motorola estimated its market share at 9.5 percent, down from 12.4 percent in the fourth quarter, and blamed a weak handset line-up in North America for the decline.

Chief Executive Greg Brown stopped short of saying the worst was over for the mobile devices business, but forecast second-quarter revenue for the unit to be flat to slightly up from the first quarter with a comparable operating loss.

"It's all about building momentum," Brown said in a conference call with analysts, in which he promised three new phones with high-speed Web links in the second quarter.

It forecast a second-quarter loss from continuing operations of 2 cents to 4 cents per share, excluding any charges related to cost-cutting efforts. Analysts were expecting a loss of 1 cent per share.

Motorola's mobile devices business saw its first-quarter operating loss widen to $418 million from $233 million in the year-earlier quarter on revenue of $3.3 billion, which was down 39 percent from a year earlier.

Its home and networks segment, which sells set-top boxes as well as wireless network gear, posted a 2 percent rise in revenue to $2.4 billion compared with the year-ago quarter and below McKechnie's estimate for $2.5 billion.

Motorola's enterprise mobility unit, which sells to business clients such as retailers, rose 5 percent to $1.8 billion, less than McKechnie's $1.9 billion estimate.

Motorola lost about 60 percent of its market value since results first started to disappoint investors in October 2006.

Motorola shares fell to $9.20 in pre-market trading from their close of $9.55 on Wednesday.

(Reporting by Sinead Carew; Editing by Derek Caney and Dave Zimmerman)



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