Motorola is pinning its hopes on new Android devices reversing its fortunes in the fourth quarter. The company last night reported Q1 net losses US$231m. Sales were down to US$5.3bn from US$7.4bn last year.
Motorola, which once led the mobile industry, is fighting a constant rearguard action, and is not only losing market share, but losing cash as well.
The company’s total cash at the end of Q1 was US$6.1bn, down from US$7.4bn at the end of 2008, due largely to a US$700m restructuring programme.
According to co-CEOs Greg Brown and Sanjay Jha, aggressive cost-cutting is underway, and the company has increased its annual 2009 cost-savings target by US$200m to US$1.7bn.
During the first quarter, Motorola shipped 14.7 million handsets, yielding revenues of US$1.8bn.
Home and network mobility sales reached US$2bn and Enterprise Mobility Solutions achieved sales of US$1.6bn.
“Our Broadband Mobility Solutions businesses performed well in a challenging environment, by delivering value for our customers and adding to an already impressive portfolio of products,” explained Greg Brown, president and co-CEO of Motorola and CEO of Broadband Mobility Solutions.
“We will continue to manage our costs to ensure alignment with current market conditions. We are executing with operational and financial discipline, while we make targeted investments for our future.”
Sanjay Jha, co-CEO of Motorola and CEO of Mobile Devices, said his division implemented aggressive actions to reduce costs and also gained solid traction on improving operational effectiveness.
“Customer feedback on our smart phone roadmap remains very positive, and we plan to have differentiated Android-based devices in stores in time for the fourth-quarter holiday season.
“We significantly reduced the operating loss in Mobile Devices compared with the fourth quarter of 2008,” Jha said.
By John Kennedy