Motorola Delays Devices Unit Spinoff
Motorola Inc. (NYSE: MOT) said this morning that it will delay the spinoff of its mobile devices unit beyond 2009 as it announced a loss of $397 million for the third quarter of 2008. (See Moto Reports Q3.)
The Schamburg, Ill.-based networking firm had been looking at the third quarter of 2009 as the target date for the spinoff. Economic troubles and a restructuring of the unit are causing the company to rethink that date, explains Sanjay Jha, Motorola's co-chief executive officer and CEO of Mobile Devices, in a statement:
- While our strategic intent to separate the company remains intact, we are no longer targeting the third quarter of 2009, primarily due to the macro-economic environment, stresses in the financial markets and the changes underway in Mobile Devices.
Overall, the company's loss of $397 million, or 18 cents per share, in the third quarter, compares with a profit of $60 million a year ago. Revenue fell 15 percent, to $7.48 billion.
The company says that the decline in sales is mainly due to continuing falling sales in its Mobile Devices unit. The company reported sales of $3.1 billion for the summer quarter compared to $3.3 billion in the previous quarter. Handset shipments fell from 28.1 million units in the second quarter to 25.4 million handsets in the July-to-September period.
Motorola's Home and Networks Mobility unit reported sales of $2.4 billion, compared to $2.7 billion in the previous quarter. Enterprise Mobility Solutions segment sales were $2 billion, flat compared to the previous quarter.
— Dan Jones, Site Editor, Unstrung