Motorola Loses Ex-Handset Head

Former Mobile Device division president Stu Reed has left Motorola Inc. (NYSE: MOT) less than a year after he had been put in place to turn the company's struggling handset business around.

Motorola's release, issued Friday evening, said simply that Reed "has decided to leave the Company, effective immediately." (See Motorola Exec Departs.)

Reed moved up to lead the handset unit in July 2007 after a long search to replace Ron Garriques, who had left in February of that year. But last month, Reed was nudged aside as Motorola CEO Greg Brown took control of the ailing division himself. (See Moto Names New Device Chief and iPhone Inspires Handset Headhunt.)

The handset unit has been struggling for more than a year, seeking to regain the success it had previously found with the RAZR phone. (See The Perils of Being Slim and Moto Losing Ground.)

In fact, Motorola recently lost its place as the second largest global mobile phone vendor behind Nokia Corp. (NYSE: NOK). The silver position now goes to South Korean giant Samsung Electronics Co. Ltd. (Korea: SEC), with Sony Ericsson Mobile Communications challenging Motorola as well.

Reporting its most recent earnings, Motorola gave no indication when the situation might turn around. The Schaumberg, Ill.-based firm's mobile devices revenue in the fourth quarter of 2007 was $4.8 billion, down 38 percent from a year earlier. The division recorded an operating loss of $388 million in the fourth quarter, compared to operating earnings of $341 million in the same quarter the previous year. (See Motorola Quiet on Device Turnaround .)

Motorola's options for the handset business include a spinoff. (See Moto Considers the Splits.)

Reed isn't the only executive to leave recently. Chief marketing officer Kenneth "Casey" Keller resigned at the end of February; Motorola says it plans to eliminate the CMO position altogether.

— Dan Jones, Site Editor, Unstrung

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