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To: T L Comiskey who wrote (7335)	10/11/2000 3:44:26 PM
From: Dealer	Respond to of 65232

QCOM???--MOT--Motorola Cuts Outlook, Shares Off By Yukari Iwatani CHICAGO (Reuters) - Shares of technology giant Motorola Inc. (NYSE:MOT - news) slumped 18 percent on Wednesday after the company cut earnings estimates for the next two years because of the weak euro, higher taxes and slower projected global growth in the mobile phone market. In a conference call one day after reporting higher third-quarter earnings that met Wall Street estimates, Motorola surprised analysts with its downgrade of expectations, particularly in the mobile phone unit. Motorola's shares, the second biggest percentage loser on the New York Stock Exchange (news - web sites), were trading off $4-13/16 at $21-9/16 in mid-afternoon on volume of 44.1 million shares. Earlier, Motorola's shares reached a nearly two-year low at $20-1/2. The company's lower outlook also sparked fears that the mobile phone industry as a whole was slowing down. American Depositary Shares of Finnish rival Nokia (NOK1V.HE) (NYSE:NOK - news) fell about 4 percent to $33-11/16 on the New York Stock Exchange, and shares of Sweden's Ericsson (LMEb.ST) (NasdaqNM:ERICY - news) were off about 1 percent at $14-5/16 on Nasdaq. Fears were also compounded by telecommunications equipment maker Lucent Technologies Inc.'s (NYSE:LU - news) forecast of weaker earnings growth through 2001. Analysts pointed out that most of Motorola's problems were specific to the company, but they expressed concern about its lowered forecast for worldwide industry cell phone unit sales. ``Three (of the reasons for the warning) are Motorola-specific and no relation to Nokia and Ericsson, but the reduction (in the) handset market could be relevant,'' said Handelsbanken tech analyst Gunnar Andersson in Stockholm. Late Tuesday, Motorola, the first of the Big Three mobile phone makers to report on its third-quarter results, reported third-quarter earnings from ongoing operations of $598 million, or 26 cents a share, up 66 percent from $361 million, or 16 cents a year ago. The company also reported revenues that were below estimates, hurt by lower-than-expected revenues in the mobile phone segment, but analysts said the results were generally on target. ``The stock and the market's reaction is worse than what's really going on,'' said Ed Snyder, telecommunications analyst with Chase H&Q. ``The quarter in operation performance was soft but not a debacle and not a disaster. The stock's getting pounded because of financial issues.'' Motorola said in the conference call that it expects the weak euro to trim fourth quarter earnings by 3 cents a share, and 2001 earnings by about 10 to 12 cents, assuming that exchange rates remain unchanged. The company also said its expected tax rate for 2001 would rise to 34 percent from 30 percent due to a shift in its profits to countries with higher tax rates. Motorola said it expects fourth-quarter earnings of 27 cents a share, below analysts' estimate of 37 cents according to First Call/Thomson Financial, which tracks such data. Motorola expects fourth-quarter revenues of $10.5 billion. Although it had previously expected handset profit margins to reach 10 percent by the end of 2000, Motorola told analysts it now expects handset margins of 6.5 percent. The company reported a margin of 6 percent in the third quarter. Analysts said they were particularly surprised by the sharp fall in handset margin outlook, noting that the 1.5 to 2 percentage point effect of the euro does not completely account for the difference. ``I think they're just not able to reach the levels that they hoped,'' said Lawrence Borgman, analyst with Josephthal & Co. ``I think it's a competitive business.'' Motorola revised its full year 2000 earnings estimate downward to 96 cents a share compared with its previous estimate of $1.05. It expects revenues of $38 billion, down from its previous estimate of $39.5 billion. Motorola said it expects to earn $1.20 a share in 2001 on revenues of $44 billion. The company's previous earnings estimate was $1.43 a share on revenues of $47 billion. After the conference call, Morgan Stanley Dean Witter cut its rating on the company to outperform from strong buy. Motorola told analysts that consumers were adopting Internet-enabled phones at a slower rate than expected and some markets, such as Europe and Asia, were reaching high penetration rates. Mobile service operators in some markets were also shifting their focus from market share growth to short-term profit growth, offering fewer price incentives for the phones, Motorola said. Analysts agreed that Motorola's challenges in the European mobile phone market were exacerbated by Nokia's aggressive move to carve out more market share. European analysts said they believed Nokia would emerge as a clear winner in the third quarter with a significant gain in market share. Motorola said the slower-than-expected growth of handset unit sales would affect sales of semiconductors, which are now expected to drop slightly in the fourth quarter compared with the third quarter. Motorola said the expected decline would prevent the segment from reaching a 10 percent operating margin in the fourth quarter. The company cut its estimate of worldwide industry mobile phone unit sales for 2000 to 410 million to 425 million units, from a previous projection of 425 million to 450 million units, which analysts considered to be on the high end. It revised its estimate of worldwide industry mobile phone unit sales for 2001 to a conservative 525 million to 575 million, from a previously more aggressive estimate of 600 million to 650 million. Motorola was the first of the Big Three companies to make a projection for 2001.

To: T L Comiskey who wrote (7335)	10/11/2000 3:48:01 PM
From: Dalin	Read Replies (1) \| Respond to of 65232

So, is goldman dumping, AND denying a miss? Hmmmm. :0) D.

To: T L Comiskey who wrote (7335)	10/11/2000 3:48:05 PM
From: im a survivor	Respond to of 65232

man...will this ever end. All I heard last week was that all the bad news was out and now we can look forward to great earnings. Then LU....MOT......YHOO did OK, but guidance wasnt too great obviously and they are tanking.....now, OBVIOUSLY QCOM, which I expected to do do wonderfully, is going to pull this crap and bring the naz all the way down to 2500 simply unbelievable....and with such a large drop in qcom today, somebody knows something......is it coincidence?? I doubt it. Goldmann can deny what they want......this is getting to freakin obvious. so what to do now ?????????????????????????