Motorola posts unexpected 2Q profit
Motorola posts unexpected 2Q profit and sells more phones
By Peter Svensson, AP Technology Writer
On Thursday July 30, 2009, 7:51 am EDT
NEW YORK (AP) -- Motorola Inc. on Thursday posted an unexpected profit for the second quarter after several quarters of losses, and sold more phones than in the first quarter.
The Schaumburg, Ill.-based electronics company earned $26 million, or 1 cent per share, in the three months ended July 4. That's up from $4 million, or break-even per share, a year ago.
The latest results were boosted 2 cents per share by various one-time effects, but even so, Motorola exceeded its own forecast, which called for a loss of 3 cents to 5 cents per share, excluding the cost of its restructuring initiatives.
Analysts polled by Thomson Reuters had on average been looking for a loss of 4 cents per share.
Motorola's sales fell 32 percent from a year ago to $5.5 billion from $8.1 billion a year ago. Analysts were looking for revenue of $5.6 billion for the latest quarter.
Motorola shares rose 13 cents, or 2 percent, to $6.70 in premarket trading. The shares have risen 58 percent this year, as investors have overcome the worst of their pessimism and have started to look for signs of a turnaround.
Motorola's sales have been on a multiyear slide, as its cell phone division has failed to come up with a product that can match the popularity of the Razr, a stupendously popular phone in 2005.
In the second quarter, Motorola sold 14.8 million handsets, up from 14.7 million in the first quarter, but just over half of what it sold a year ago.
The profit was evidence of Motorola scaling back heavily on its costs. It is laying off thousands of employees this year.
It is not the first time Motorola has appeared to be on the cusp of a turnaround: in the second quarter last year, it also posted a small surprise profit and reported shipping more phones than the first quarter. Its shared soared, only to lose more than half their value before the end of the year.
Motorola's non-phone divisions, which make police radios, equipment for cable companies, and other electronic gear, continued to make up for losses in the cell phone division, though their sales have also been affected by the recession. They make up two-thirds of the company's sales.
finance.yahoo.com |
