Motorola Android Phone Still Months Away
Still bleeding a sea of red ink and with no apparent buyers for its handset unit, Motorola is focusing on a differentiated Android phone for the holiday season. That, unfortunately, leaves room for more quarters of spiraling losses.
Motorola's first Android phone can't get here fast enough for the struggling handset maker, which reported April 30 another disastrous quarter. Although there were glimmers of hope in Motorola's first-quarter numbers-it managed to hang on to its No. 4 spot among handset makers and losses weren't quite as bad as Wall Street anticipated-Motorola continues to bleed losses quarter after quarter.
Despite continued aggressive cost-cutting during the first quarter, including the elimination of thousands of jobs, Motorola still saw overall revenues drop 28 percent from a year earlier. The numbers were particularly ugly in the handset unit: Operating loss widened to $509 million as sales dropped 45 percent to $1.8 billion.
Motorola co-CEO Sanjay Jha, who was brought in from Qualcomm more than a year ago to lead a so-far unsuccessful spinoff of the struggling handset unit, said in a conference call, "In the quarter at Mobile Devices, we implemented aggressive actions to reduce costs and also gained solid traction on improving operations effectiveness."
For the quarter, Motorola shipped 14.7 million handsets, a 23 percent slide from the fourth quarter. News at Motorola's other two divisions was a bit brighter. Although sales at the Home and Networks Mobility division and the Enterprise Mobility division saw sales fall, they remain profitable.
With a spinoff more rumor than reality, Jha has turned his attention to bringing a high-end smartphone to the market built on the Android platform by the end of the year. Jha said the smartphone will be available through multiple carriers across different regions of the United States. Like other smartphones, Motorola's Android will focus on multimedia, messaging, Web browsing and mobility.
T-Mobile, meanwhile, has already introduced and sold more than a million Android G1 phones, raising questions of just what would be different about a Motorola Android handset. Jha promised "differentiated Android-based devices in stores in time for the fourth-quarter holiday season," and added that "customer feedback on our smartphone road map remains very positive."