Motorola reports loss but beats expectations

SCHAUMBURG, Ill.—Motorola Inc. beat analyst expectations and reported a net loss for ongoing operations, excluding special items, for the first quarter ended March 30, of $174 million, or 8 cents per share. Analysts predicted a loss of between 11 cents and 14 cents per share.
Including the special items however, Motorola generated a net loss of $449 million, or 20 cents per share, compared with a net loss of $533 million, or 24 cents per share, for the same period the previous year.
Executives also announced the company is eliminating 850 more jobs at its distribution center in suburban Chicago as part of ongoing efforts to restructure and realign the company with a more profitable business plan. Motorola already has slashed more than 49,000 employees since the end of 2000.
Motorola’s net sales for the quarter totaled $6 billion, a decrease from sales of $7.5 billion, reported for first quarter 2001. A 26-percent and 36-percent decline in sales in the semiconductor and broadband sectors, respectively, contributed to the decline, although Motorola’s personal communications sector showed promise, with sales of $2.3 billion, up 1 percent from a year ago.
Analyst reactions ranged from still skeptical to slightly optimistic. Lehman Brothers said it believes Motorola will continue to benefit from its restructuring momentum, while Morningstar said the results don’t necessarily indicate any imminent recovery.
Shares of Motorola jumped nearly 10 percent to close at $15 immediately following the release of the results last night, and the stock continued its climb this morning, trading right around $16 per share.