Motorola posts $231M net loss, sheds light on Android
Motorola posted a $231 million net loss in the first quarter, and offered a few fresh details on its plans to build smartphones using Google's Android platform. The Android smartphone strategy appears to be what co-CEO Sanjay Jha is pinning his hopes on as a catalyst for a turn-around in Motorola's troubled mobile devices division.
The company's overall net loss was greater than the $194 million net loss it reported in the year-ago quarter. Company-wide, sales came in at $5.4 billion, down 28 percent from $7.5 billion last year. Motorola also increased its 2009 savings target by $200 million, to $1.7 billion.
In the company's handset division, sales were $1.8 billion, down 45 percent from $3.3 billion in the year-ago quarter. The handset division's operating loss narrowed on a sequential basis to $509 million, down from $595 million in the fourth quarter of 2008, but still wider than an operating loss of $418 million in the year-ago quarter. Motorola shipped 14.7 million handsets in the quarter, down by almost half from the year-ago quarter and down 23 percent from the fourth quarter of 2008. Motorola said its global handset market share was 6 percent, and that its average selling price was flat.
According to new numbers from Strategy Analytics, Motorola's first-quarter performance returned the company to the No. 4 position in terms of global handset market share. The company fell behind Sony Ericsson in the fourth quarter of last year, but it regained the No. 4 position in the first quarter of 2009. Sony Ericsson's global market share in the first quarter was 5.9 percent, according to Strategy Analytics, while Motorola slid in at 6 percent.
Motorola's shares were down 29 cents to $5.76 in morning trading.
Android action: In the company's earnings conference call, Jha gave some new details about Motorola's Android plans, reiterating that the company is still on track to deliver Android-based handsets in the fourth quarter. He said Motorola would launch its Android handsets with multiple carriers, and not just in North America. "We are in detailed discussion with multiple carriers around the world," he said. "It won't be one carrier in one region. It will be multiple carriers in multiple regions."
Jha said Motorola would differentiate its Android products by offering "enhanced integration of messaging and social networking capabilities." Jha seemed to indicate that the company would launch multiple Android offerings at mid-tier and high-tier price points, and emphasized the importance of the platform. "We are looking to consolidate to one platform and leverage that platform for multiple devices," he said.
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