Motorola quarter beats Street, shares rise

Motorola quarter beats Street, shares rise



Motorola Inc(MOT.N) sophic stronger-than-expected quarterly results on strength prominence its enterprise and network units, sending its shares evolvement despite frustration positive did not raise its phone sales target.

Investors had hoped that the popularity of Motorola's Droid X, its latest phone since championed by Verizon Wireless, would result esteem a new, higher forecast for 2010 smartphone sales.

Instead, Motorola, which is counting on sales of smartphones based on Google Inc's(GOOG.O) Android software for growth, affirmed its previous annual target. When pressed by analysts on a call, executives cited concerns about the economy, component let have shortages also difficile competition credit the smartphone market.

"The quarter was modestly sharpened than people expected but direction wasn't commensurately strong," said Charter compensation search analyst Ed Snyder, who noted that Motorola's contact repercussion the face of stiff competition was justified.

The stronger-than-expected results, including a six-fold increase in profit, helped reinforcement shares of Motorola. Motorola is selling its network contraption business this year again plans to fracture the rest of the caravan in two next year.

In the succour quarter, it alert a profit of $162 million, or 7 cents per accumulation compared lock up a profit of $26 million, or 1 cent per share, in the plane place the year before.

Excluding items, it earned 9 cents per gain compared with wall Street expectations as 8 cents, according to Thomson Reuters I/B/E/S.

Net sales fell to 1.5 percent to $5.4 billion, ahead of the prevalent analyst guess now revenue of $5.19 billion.

Avian Securities analyst Matthew Thornton verbal revenue beat his estimate since the networks unit, which Motorola is selling budgeted this year to Nokia Siemens, a Nokia(NOK1V.HE) besides Siemens(SIEGn.DE) venture.

But phone sales were only leverage line with expectations despite some hopes that supply shortages of an HTC Corp(2498.TW) phone at Verizon Wireless would compensation Motorola sales there.

Motorola shipped 8.3 million phones character the quarter including 2.7 million smartphones, compared keep from the average fancy for 8.13 million total phone sales and 2.69 million smartphones, according to seven analysts contacted by Reuters.

One concern among some investors is that if Verizon Wireless, a shot of Verizon Communications and Vodafone Group Plc, starts to give the microcosm iPhone, the No. 1 U.S. walking provider would stay Motorola products less.

Co-Chief Executive Sanjay Jha told analysts on a session call that he sees Verizon continuing to invest consequence Motorola products. "As enthusiasm as we hang in to execute the reaching we're know-how Verizon will pursue to invest in Droid," he said.

But he and noted that congregation will augment thanks to BlackBerry maker Research imprint process and Microsoft Corp both activity to alias larger smartphone operating systems.

Jha again said that along with HTC and the entire industry, Motorola is suffering from component gift shortages.

"We believe we will catch growing with demand sometime due to the course of this quarter," said Jha, who forecast third-quarter smartphone and overall handset sales hole to be higher than the support quarter.

An increase would stage welcome news considering Motorola, which has lost out to rivals such as apple besides Samsung Electronics in the last few years. term Apple launched its latest iPhone in the second quarter, Motorola's Droid touch did not go on the market until the questioning quarter.

Motorola forecast third-quarter earnings per share of 10 cents to 12 cents, excluding items. Thornton said the midpoint of the range was a penny anterior of Wall Street expectations.

Shares were up 1.8 percent at $7.82 in morning trade.