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Motorola reports loss for second straight quarter

Motorola reports loss for second straight quarter

Motorola on Wednesday announced its second loss in as many quarters, citing ongoing difficulties in the telecommunications and semiconductor markets.

Motorola reported revenue of $US7.5 billion for its fiscal second quarter, which ended June 30, a decrease of 19 per cent from a year ago, the company said in a statement. Including pro-forma adjustments, Motorola posted a loss of $232 million, or $0.11 per share, compared with earnings of $551 million, or $0.25 per share, in the year-ago period.

The company inched past the expectations of analysts, who had expected the company to report a loss of $0.12 per share, according to a consensus estimate gathered by Thomson Financial/First Call.

The company said sales decreased in all of its major product segments except for broadband communications.

Excluding the pro forma adjustments, which include a pretax charge of $496 million, or $0.24 per share after tax, related to cost reduction measures, Motorola actually incurred a loss for the quarter of $759 million or $0.35 per share, the company said.

When Motorola announced its first quarter earnings in April, the company reported its first operating loss in 15 years, blaming a worldwide slowdown in the technology industry.

The second quarter has been no kinder to the telecommunications industry. Last month, Finland's Nokia issued a profit warning, lowering its estimated year-on-year growth from 20 per cent to 10 per cent. Although Sweden's Ericsson has not issued a warning for the quarter, it closed last quarter by saying it would cut up to 12,000 jobs, and said it expects to report a loss in the second quarter.

Motorola last month exited the Mexican cellular market, completing the sale of its Baja Cellular, Movitel, Norcel, and Cedetel divisions to Spain's Telefonica SA for $1.8 billion in stock.

Prior to the earnings announcement, Motorola's shares on the New York Stock Exchange closed up 1 per cent, at $15.67.


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