Motorola takes $194m loss on poor cell results

Motorola today reported a $194 million loss for the first quarter of 2008. The drop primarily echoed late 2007 results and is chiefly attributed to the company's declining Mobile Devices business, which includes the company's cellphone designs. The group has seen its sales drop by about 39 percent versus the same quarter a year ago and was the only of three major divisions to post a significant operating loss, losing $418 million. The Home and Networks Mobility and Enterprise Mobility divisions turned slight losses and significant profits respectively.

The company continued to hold its edge against Sony Ericsson in world marketshare for cellphones. It shipped 27.4 million cellphones in the year versus 22.3 million for its primarily Europe-focused rival. However, the results are still considerably short of market leader Nokia, which shipped 115.5 million phones during the same period.

Motorola doesn't say when it hopes to recover the business but notes that the recent quarter saw crucial decisions that should ultimately turn around the mobile business, including the choice to spin off the mobile division as a separate company by next year and reorganize executives in the group to allow them to have better control across the entire design process, preventing flaws that might occur at later stages in the pipeline. The company also touted the important launches of several significant phones, including the Z9 slider at AT&T and the Q 9c smartphone for various CDMA carriers in North America.

Motorola has lately been struggling to avoid defections to rival products. In the US, the company has seen Apple snap up some of its share through switches from RAZRs to iPhones and potentially similar losses from its Windows Mobile devices.

Filed under: iPhone, industry
Other story tags: Nokia, Motorola, Sony Ericsson