updated 05:50 pm EST, Fri January 6, 2012
Motorola says Q4 lower than expected
Motorola sent out a warning late Friday that its fall performance wouldn't meet. It would still see "modest profitability" based on revenue of $3.4 billion, but it would see just 10.5 million phones shipped, 5.3 million of which would be smartphones. The number would be a sharp contraction from the 11.6 million shipped in the summer, when it moved 4.8 million smartphones.
No immediate tablet forecasts were given for tablets, although Motorola has seen the devices' numbers dwindle. Most Wall Street analysts had been expecting $3.9 billion in revenue, showing a steep gap between initial views and results.
The company made thinly veiled references to Apple as being largely responsible for the fiscal and unit drops. Its downfall was due to the "the increased competitive environment in the Mobile Device business and higher legal costs associated with ongoing Intellectual Property... litigations," Motorola said.
The iPhone 4S is known to have kept the Droid RAZR down in sales at Verizon, while the iPad has largely gone without serious opposition from any Motorola tablet to date. Apple has been suing Motorola in multiple courts in what's considered a proxy war over Android. Amazon and Samsung are also known to be cannibalizing Android tablet and smartphone sales from their competitors.
Google's $12.5 billion takeover of Motorola was still on track for an expected early 2012 close, although Motorola cautioned that there was no guarantee that possible regulatory blocks and other factors might delay or shutter the deal.
The news is likely to see Motorola further lose market share. Holiday sales normally see an upswing, and while smartphones were up overall, the preliminary look suggests they weren't growing quickly enough to make up for its withering basic feature phone sales. Tablets may also be dark given that the Xyboard arrived late and already received a price cut, usually a sign of poor sales.