Motorola closes gap on losses

Motorola has announced Q3 sales of $5.5 billion (£3.34), down from $7.48 million in the same quarter last year. However the company has reduced the losses from its Mobile Devices division significantly and has forecasted improved financial results for next year.

The company has increased its cost reduction plan by $100 million and is now expecting a total cost savings of $1.9 billion for 2009.

Its Mobile Devices unit remains a loss maker compared with its Home and Networks Mobility unit and Enterprise Mobility Solutions unit. Mobile Devices brought in sales of $1.7 billion at an operating loss of $183 million and down 46 per cent from the same quarter last year, shipping 13.6 million handsets. This compares with the 15.95 million handsets it shipped in Q2 this year and the 25.4 million handsets it shipped in Q3 last year, however it has closed the gap on its operating loss from the same quarter last year, which measured $840 million.

The Mobile Devices unit also reduced its operating loss by 28 per cent sequentially from $253 million in Q2 this year.

Motorola's Home and Networks Mobility unit brought in sales of $2 billion with operating earnings of $199 million, while its Enterprise Mobility Solutions sales brought in $1.8 billion, with operating earnings of $306 million.

The company said its improved 2010 smartphone portfolio, running largely on the Android OS, would deliver improved financial results next year.

Motorola co-chief executive Sanjay Jha said: "We delivered on our commitment to improve the financial performance of Mobile Devices and to commercially launch two smartphones in time for the fourth-quarter holiday season. The introductions of our new products powered by Android are important milestones as we begin to address the mobilisation of the internet and the growing demand for modern smartphones. Next year, we will continue to expand our smartphone portfolio and deliver improved financial results."

Motorola estimates its global handset market share for Q3 to be 4.7 percent, compared with 5.6 per cent in Q2.