Motorola slips past first-quarter forecasts

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13 October 2000 03:00 PM
Tags: motorola, quarter, sales, million, billion, percent, ago, instrument
Motorola edged past analysts' estimates in its first quarter Monday, raking in US$449 million, or US59 cents a share, on sales of US$8.8 billion. Its shares closed off 3 3/4 to 150 ahead of the earnings report.

First Call consensus expected Motorola (NYSE: MOT) to earn US58 cents a share in the quarter.

The US$8.8 billion in sales marks a 13 percent improvement from the year-ago quarter when it earned US$184 million, or US26 cents a share, on sales of US$7.7 billion.

"We are especially pleased by the results in our new broadband communications sector, which was formed after the merger with General Instrument, the improvements in our network systems business, and the sequential growth in quarterly earnings for semiconductors," said CEO Robert Growney in a prepared release.

In the quarter, Motorola's semiconductor business posted sales of US$1.9 billion, up 24 percent from the year-ago quarter. Operating profits rose to US$123 million from US$10 million a year ago.

Company officials said sales were up "significantly" in Europe and the Americas.

  • Its personal communications business, which battles with the likes of Nokia (NYSE: NOK) and Ericsson (Nasdaq: ERICY), Motorola recorded sales of US$3.2 billion, up 24 percent from the same period last year. However, operating profits slipped to US$49 million from US$83 million, mainly due to a switch in the wireless phone product mix to low-tier products with smaller margins.

  • Its network systems unit posted sales of US$1.8 billion in the quarter, up 11 percent from the year-ago quarter. Operating profits surged to US$280 million from US$193 million.

  • Broadband communications sales stormed up 15 percent to US$678 million while orders jumped 46 percent to US$880 million.

    The upswing in broadband sales is partially a result of the company's January merger with General Instrument. The segment combines the operations of General Instrument with the previously existing cable modem and telephony business of Motorola's Internet and networking Group.

    Last quarter, Motorola pocketed US$514 million, or 82 cents a share, on sales of US$8.5 billion.

    Looking ahead, Motorola will offer its much-anticipated T 2282 phone next quarter.

    Its shares peaked at 184 5/8 in March after falling to a low of 73 3/4 last April.

    Twenty-seven of the 34 analysts following the stock maintain either a "buy" or "strong buy" recommendation.

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