Is Motorola A (Clam)Shell of Its Former Self?

Is Motorola Inc. (MOTO) a (clam)shell of its former self?

That’s what observers are wondering as 2009’s second quarter results showed the once-formidable manufacturer continues to sell fewer phones. In Motorola’s wireless device unit alone, revenue plunged 45 percent to $1.8 billion, the company reported July 30. Operating losses came to $253 million. Overall, Motorola posted a sales drop of 31 percent, or $5.5 billion, compared to the same period a year ago.

Yes, Motorola did record a profit, but that’s only thanks to cost controls that included hundreds of layoffs. Net income totaled $26 million, a huge jump over the $4 million of a year ago. Still, Motorola is losing sales and can only cut so many jobs before matters grow even more dire.

Executives are hoping things don’t go that far.

“”We have agreements in place with carriers and remain on track to bring our new smartphone devices to market for the holiday selling season,” Sanjay Jha, co-CEO of Motorola and CEO of Mobile Devices, said in a prepared statement. “We are also excited about our 2010 portfolio and are pleased with the customer feedback.”

To that point, tech geeks have been salivating for the Android phone, based on Google’s open-source operating system; Motorola has the rights to the technology and said in the first quarter it would start shipping the phones sometime this year. On a July 30 conference call with analysts, Jha said Motorola will have two Android devices in time for the holidays.

If Motorola does meet its launch dates, will that mark the start of a turnaround for the company?


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