Analysts: Motorola is disappearing

By on April 30, 2009, 3:50 PM
Cell phone producer Motorola has posted another loss in profits, and experts predict that the numbers will keep on dwindling. This quarter, the company saw a net loss of $231 million, or $0.13 per share, as compared to a net loss of $194 million in the year-ago quarter. Company revenue fell 28% throughout the first quarter to $5.4 billion, and the mobile phone division reported an operating loss of $509 million dollars.

The Illinois-based company reportedly shipped 14.7 million handsets during this period, giving it an even 6% share of the global handset market. This number is down significantly from a more reassuring 17.5% share of the market two years ago, after it enjoyed a bout of success with the then trendy Razr cell phone.

According to co-chief executive Sanja Jha, the company has set its sights on reducing annual costs for the deteriorating mobile devices division at more than $1.3 billion. Division CEO, Jha went on to say that the company has implemented aggressive actions as a means of reducing costs, and have gained solid traction on improving operational effectiveness. He also stated that the company is on track to deliver Android-based phones in the fourth quarter of this year.

The home and networks and enterprise solutions divisions have experienced a more forgiving quarter, posting operating incomes of $115 and $156 million. Despite that fact, analyst Douglas Mclntyre of 247WallSt.com, believes Motorola is “slowly disappearing” and has “no chance” of spinning-off the mobile division to shareholders.




User Comments: 5

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DarkCobra said:
Well they're definitely down right now, but far from out for the count. Clearly, the incredible success they had with the Razr series has naturally diminished as can be expected with time. They got a lot of good millage out of that series. This is still a very solid company and I'm sure they will continue to be solid phone players. They've been around a long time from the original and incredibly excellent StarTacs to the Razr's. Right now the Iphone and Blackberry's are getting a lot of attention. True enough. But Moto knows how to build a phone and I think they'll not only be around but be back with some popular products again.
Wendig0 said:
I will second that DarkCobra. Motorola is a good strong company despite taking inevitable losses in an economic recession.
noname said:
[url]http://www.networkworld.com/slideshows/2009/032309-ceo-p
yday.html#slide24[/url][url]http://www.networkworld.com/sl
deshows/2009/032309-ceo-payday.html#slide21[/url]No wonder Motorola is disappearing :)
DarkCobra said:
LOL . . . well I agree that CEO salaries are "off the hook", but I don't think THAT is the reason Moto has slipped in the cell market. They'll be back. Yes, that CEO salary needs revision.
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