Motorola is hoping the launch of its Android phones by two U.S. carriers in the fourth quarter is a success, but it isn't betting the handset division's financial future on having a holiday blockbuster, according to co-CEO Sanjay Jha.
"My purpose is to get back in the game and build upon it," Jha, who heads Motorola's mobile devices business, said in an interview with Dow Jones Newswires. "While I'm hoping it's a home run, we're not banking our financial results on it." Jha seemed to indicate that a possible Motorola recovery would be more gradual than investors may be hoping for.
In yesterday's earnings conference call, Jha said Motorola would produce most of its smartphones internally, but would work with ODM partners to produce lower-end phones. Jha said that in the future Motorola would not be focused so much on market share and unit shipment volumes as it would be on regaining relevance, improving handset margins and pushing up average handset selling prices.
Despite the lowered expectations, Motorola remains locked in an uphill battle to regain its footing in the handset market. The smartphone market has grown increasingly crowded, and carrier support for high-profile phones like the Palm Pre has been crucial to success. Jha said he would let Motorola's carrier partners decide whether they would make the company's Android phones high-profile "hero" gadgets--adding that the devices are capable of being hero phones.
Motorola's handset division had sales of $1.8 billion, down 45 percent from the year-ago quarter and flat from the first quarter. The division's operating loss narrowed to $253 million, improved from an operating loss of $346 million in the year-ago quarter and improved 50 percent from $509 million in the first quarter.
- see this Dow Jones Newswires article (sub. req.)
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