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To: gladman who wrote (91273)	1/17/2000 7:05:00 PM
From: Glenn D. Rudolph	Respond to of 164684

Top Financial News Mon, 17 Jan 2000, 6:59pm EST Motorola Fourth-Quarter Profit Triples on Demand for Cellular Phones By John Stebbins Motorola 4th-Qtr Profit Triples on Cell Phones (Update1) (Adds details, analyst comment.) Schaumburg, Illinois, Jan. 17 (Bloomberg) -- Motorola Inc., the world's No. 2 maker of cellular phones, said fourth-quarter profit more than tripled on sales of digital mobile phones, though earnings and revenue missed the most optimistic forecasts. Profit from operations rose to $514 million, or 82 cents a share, from net income of $159 million, or 26 cents, a year earlier. Revenue climbed 1.9 percent to $8.45 billion from $8.34 billion. Sales of cell phones increased during the quarter although orders fell in the Americas. Motorola blamed a shortage of some parts used in making wireless phones for the slowdown. The parts shortage may continue into the second quarter, the company said. ``They would have destroyed the quarter' if not for the parts problem, said Ed Snyder, a Chase H&Q analyst. He was expecting earnings of 82 cents a share and $8.9 billion in revenue for the quarter. Analysts expected profit of 81 cents, the average of estimates from First Call/Thomson Financial. Estimates on the Internet were as high as 84 cents. Forecasts for revenue ranged from $8.5 billion to $8.9 billion. Shares of the Schaumburg, Illinois-based company rose 12 7/16, or 9 percent, to a record 151 Friday. U.S. markets are closed today for the Martin Luther King Jr. holiday. Motorola's shares have more than doubled in the past year. Snyder said the shares may fall tomorrow when U.S. trading resumes. Two-Edged Sword Worldwide demand for cell phones was greater than Motorola and other manufacturers forecast at the beginning of 1999. Some customers ordered more phones than expected in the third quarter, leading to fewer orders in the fourth, Motorola said. Still, the company is selling more of its digital phones as it competes with No. 1 Nokia Oyj. Sales in Motorola's Personal Communications Segment, which includes cell phones, rose 13 percent to $3.5 billion and orders increased 12 percent to $3.6 billion. Operating profit rose almost fivefold to $243 million from $52 million a year ago. Cell phone shipments from all manufacturers will increase to at least 1 billion in 2005 from about 400 million this year, according to Dresdner Kleinwort Benson. Motorola, the world's No. 6 semiconductor maker, also is profiting from a restructuring of its sprawling chip business during the past two years. The company cut jobs and sold lower- profit lines to concentrate on more profitable products. Sales in the semiconductor unit increased 15 percent to $1.8 billion and orders rose 24 percent to $2 billion. The company had an operating profit of $81 million compared with a loss of $102 million a year ago. Gains and charges that together total $165 million, or 26 cents a share, reduced net income to $349 million, or 56 cents. There were no charges in the year-ago quarter. The charges include $518.7 million for Motorola's financial exposure to the Iridium LLC satellite venture.