Wednesday, January 23, 2008
Motorola Profit Plunges 84%
Associated Press - Motorola [MOT] said Wednesday its net profit fell 84 percent in the fourth quarter...Motorola reported a net profit of $100 million, or 4 cents a share, down from a year-earlier profit of $623 million, or 25 cents a share. Sales fell to $9.65 billion from $11.79 billion a year earlier. ”The recovery in Mobile Devices will take longer than expected and there is a lot more work to be done,” Motorola’s chief executive Greg Brown said in a statement. ”Our primary focus is on improving profitability and enhancing our product portfolio in this business.” The company forecast a first-quarter loss from continuing operations of 5 cents to 7 cents a share. Analysts had estimated earnings per share of 10 cents for the first quarter.And it seems Illinois based Motorola's loss is Finland based Nokia's gain. And LG's gain. And Samsung's gain. And Sony Ericsson's gain. The Finland based Nokia is set to announce its Q4 and yearly results today and LG Electronics tomorrow (this post will be updated to reflect those results), but Reuters as a preview of what's in store from Nokia and the other mobile giants. Nokia and other large cellphone vendors likely increased their market share in the quarter at the expense of struggling U.S. vendor Motorola. Nokia's Q4 earnings per share minus one-offs are expected to rise 47 percent from a year ago to 0.44 euro, according to the average forecast from a Reuters poll of 34 analysts. The Finnish company has a strong lead in emerging markets including China and India, which it has been fiercely defending. Sony Ericsson is expected to have sold 31.4 million phones in the quarter, up 21 percent from a year ago...Samsung is expected to have sold a record 48-49 million phones in the quarter, roughly 50 percent more than a year earlier.
Which basically means that four out five of the heavyweights are showing massive gains while Motorola struggles. Can't call that a market trend. Let's just say that Motorola screwed up, as they did with Iridium, which, for those who remember it, was a really painful affair of theory and potential and a technological breakthrough being washed away by gross mismanagement and a pathetic financial model. It cost more than $5 billion to build, and was sold in an emergency firesale for $25 million. Like I said, sheer pain. These Motorola chaps really need to start learning something from their own past mistakes.
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