Motorola on Target for Second Quarter

Motorola Inc. will meet and possibly beat its second-quarter guidance, company officials said Wednesday.

The company, which has posted losses for five consecutive quarters, said it is on target with April preditctions that it will post a second quarter loss of four cents a share and a revenue of at least $6.4 billion.

The Schaumberg, Ill., company also expects to be profitable by the third quarter and post a profit for the full year.

Company officials acknowleged that some of that profitability will be due to downsizing. Motorola plans to cut its staff to 100,000 by the end of the year, down from 150,000 in April.

But the company also intends to gain market share from competitors such as Nokia Corp. with its wireless chipset business and new handsets such as the A820, which includes embedded global positioning system support and an MP3 player.

Motorolas guidance contrasts that of Nokia Corp., which this week warned that second quarter 2002 sales will be worse than expected, but maintained that earnings will stay in line with previous estimates.

Sales of Nokia phones in the second quarter are expected to grow zero percent to 4 percent year on year instead of the previously expected 5 percent to 10 percent.

Nokia Networks back-end equipment sales are expected to decrease by 20 percent to 25 percent, compared with earlier guidance of a decrease of 5 percent to 10 percent, due to cautious carrier customers, said officials at the Espoo, Finland, company.

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