This quarter’s loss will be at least 10 cents a share, excluding some costs, the company said today in a statement. That trailed the 4-cent average of estimates compiled by Bloomberg.
Phone shipments fell by half last quarter as devices such as the touch-screen Krave failed to match the success of its once best-selling Razr, released in 2004. Last month, co-Chief Executive Officers Greg Brown and Sanjay Jha decided to cut about 4,000 jobs, with more than three-fourths of the reductions coming from the mobile-devices unit.
“They clearly have challenges ahead as they reconfigure their product line,” said Blaine Carroll, an analyst at FTN Midwest Research in Boston. “It’ll take six to nine months.” He has a neutral rating on the shares.
The company’s fourth-quarter loss was $1.57 a share, compared with a profit of $100 million, or 4 cents, a year earlier. Sales fell 26 percent to $7.1 billion, missing the $7.2 billion average of estimates compiled by Bloomberg.
“In light of the economic climate and challenges we face, we have implemented aggressive measures to reduce costs and improve financial flexibility, particularly in mobile devices,” the co-chiefs said in the statement.
Motorola, based in Schaumburg, Illinois, fell 14 cents to $4.40 in early trading after closing at $4.54 on the New York Stock Exchange yesterday. The shares had dropped 64 percent in the past year before today.
Job Cuts
More than half a million people have lost their jobs in the U.S. in the past three months, with companies like AT&T Inc. and Sprint Nextel Corp. reducing workforces to protect themselves from the deepening recession.
In October, Motorola delayed plans to split off its phone unit, citing the global economic slump. Brown had proposed the separation about six months earlier, bowing to pressure from investor Carl Icahn.
Global mobile-phone shipments may fall 13 percent this year, the first decline since 2001, according to Citigroup Inc. Last year Motorola introduced the touch-screen Krave as a competitor to Apple Inc.’s iPhone. The iPhone supplanted Motorola’s Razr as the bestselling phone in the U.S. in the third quarter.
Motorola shipped about 19.2 million handsets in the fourth quarter, compared with about 41 million in the year-ago period. Motorola’s top ranking in the U.S. mobile-phone market vanished in the third quarter as its share of sales slid to 21.1 percent from 32.7 percent a year earlier, according to researcher Strategy Analytics in Newton, Massachusetts.
Sales at Samsung Electronics Co., based in Suwon, South Korea, rose to 22.4 percent of the market from 17.9 percent.
