Motorola Posts Profit; Could New Phones Keep Momentum Going?


Motorola has swung the pendulum and recorded a profit for its third quarter. The figures are largely due to cost-cutting; however, Motorola is poised to reap benefits from two recently introduced smartphones, the Cliq and the Droid, due out next week. If the company positions and manages itself properly, it could continue to see a rosier future.

For the period, Motorola posted a profit of $12 million, or a penny a share, compared with a year-earlier loss of $397 million, or 18 cents a share. Revenue, however, plunged 28 percent to $5.45 billion, mainly because of faltering handset sales. Motorola Mobile Devices reported quarterly sales of $1.7 billion on shipments of 13.6 million handsets; however, that still resulted in a division operating loss of $183 million. The company, once riding high on sales of its wildly popular Razr cell phone introduced in 2004, has struggled to develop a follow-up act.

The Cliq and the Droid are set for release for the holiday shopping season. "The introductions of our new products powered by [Google's] Android [operating system] are important milestones as we begin to address the mobilization of the Internet and the growing demand for modern smartphones," Sanjay Jha, co-CEO of Motorola and CEO of Mobile Devices, said. "Next year, we will continue to expand our smartphone portfolio and deliver improved financial results."