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Aug. 1, 2008

Although Motorola posted a small quarterly profit after selling more mobile phones than it expected, wireless industry analysts say the mobile phone maker still has a long way to go to turn around the struggling company.

With its second quarterly earnings, Motorola was able to maintain its No. 3 market share position, just behind Nokia and Samsung.

However, Motorola’s mobile devices business was the only division to post a loss.

It posted a wider operating loss of $346 million compared with an operating loss of $332 million for the same quarter in 2007, on revenue that dropped 21.9 percent to $3.3 billion.

Motorola said it shipped 28.1 million mobile phones and MIDs (Mobile Internet Devices) in the second quarter.

Q2 profit was $4 million, leading to a break-even on a per-share basis, compared with a loss of $28 million in the year-ago quarter.

Lately, Motorola has been trying hard to recover from recent downturns and setbacks, while also seeing its stock drop well over over 71.2 percent in the past eighteen months.

In Q1, it announced plans to spin off its mobile device business for next year, but hasn’t found any takers as of yet.

Motorola's TV set-top box and networks equipment division posted operating earnings of $245 million, up 28 percent from 2007, on sales of $2.7 billion, which were up 7 percent as compared to a year earlier.

Motorola's enterprise mobility unit saw sales rise 6 percent to $2 billion from the year-ago quarter.

On July 29, Motorola unveiled plans to divide its home and networks mobility unit into three distinct businesses – cable set-top boxes, cellular networks and broadband access solutions business.

Some wireless industry analysts have suggested that this reorganization would actually make it easier for the phone maker to sell those divisions off rather than the handset business. It simply would make a lot of sense for Motorola.

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Source: Motorola.