Motorola Reports Smaller-Than-Expected Second-Quarter Disaster
by John Paczkowski
Posted on July 31, 2008 at 11:01 AM PT
Now that they’ve had time enough to recover their dropped jaws from the floor, investors surprised by Motorola’s second-quarter earnings are driving up its share price. Motorola shares spiked 12.2 percent to $8.62 in late-morning trading today after the long-suffering company issued break-even per-share earnings and positive guidance.
Quite a shock for Motorola (MOT) observers, who had figured the company was prepping a $124 million second-quarter net loss, about four times larger than the one it posted a year ago. A bit of a shock too for Motorola, which itself had predicted a loss of two cents a share. In short, great news for the company, which may have just turned the tide in an ugly year-long trend of losses.
That said, Motorola still faces many challenges. Its share price is down more than 61 percent since its decline began in Oct. 2006. And its post-Razr phone business is in collapse at a time when the public is becoming increasingly fascinated with the eye-catching devices peddled by its rivals.
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