Motorola reports Q1 loss, predicts more
Motorola Inc. reported a $206 million loss, or 9 cents a share (excluding special charges), in its first quarter and expects to incur a loss in the second quarter, the company reports. Its operating loss for the quarter is Motorola's first in 15 years.
Second-quarter losses may be a few cents higher than the 9-cents-a-share loss, the company says.
President and COO Robert L. Growney notes in a statement there are three reasons for the expectations.
"First, as a result of our sale of several investments in cellular service providers in the first quarter, operating profits were generated in the form of a return of previously deferred margin on our infrastructure sales to those service providers," Growney says, leading to anticipated smaller amounts of deferred margin to be returned as operating profit.
Second, management received smaller amounts of incentives in the first quarter than in 2000, "resulting in a reversal of the difference back to income," he says.
Finally, the company anticipates a lower manufacturing margin in the second quarter, from shifting sales and declines in semiconductor sales from the first quarter.
In a conference call with analysts, Chair and CEO Christopher Glavin compared the present tech market with boom-and-bust cycles in the mid-'70s and mid-'80s, according to Reuters.
The predictions come "even as sales and savings from cost-reduction actions increase sequentially," Growney says, and Motorola expects a gradual upturn in the second half of 2001.