Motorola Mobile May See Loss in First Quarter as Company Divides

By Ed Silverstein December 03, 2010

Just as the company divides itself into two entities, Motorola’s mobile division expects to see a loss in the first quarter of the fiscal year.

Speaking with analysts, Motorola co-CEO Sanjay Jha said this week, "We expect a loss in mobile devices in 1Q," according to a report from the AFP news service. Still, Jha was positive overall and said the first quarter numbers would be "significantly improved from a year ago," AFP reported. He added that the current quarter is "proceeding quite well."

Jha predicted strength in fields like smartphones and tablets, according to a report from All Things Digital. Motorola is expected to be selling 4G phones sometime in early 2011, Jha said, according to All Things Digital.

Motorola Mobility, the name of the company’s mobile phone division, will be split off from the rest of Motorola on Jan. 4, the company said.

According to a report from TechZone360, the new company will be made up of Motorola’s remaining consumer products, which now include items such as cell phones and cable top boxes. The second company will feature such products as radios for law enforcement, as well as barcode scanners.

A third focus of the company, network equipment for cell phone companies, is expected to be sold to Nokia Siemens Networks by the end of the year, according to a report from the Associated Press.

Under a plan approved by Motorola’s Board of Directors, Motorola stockholders will receive 1 share of Motorola Mobility common stock for every eight shares of Motorola common stock they hold, the company said.

The other company will be known as Motorola Solutions.

In other recent company news, Motorola announced this week that Motorola Mobility will acquire 4Home, Inc., a developer of connected home services. Terms of the transaction were not disclosed. The deal is expected to close by the end of the month.

Ed Silverstein is a TechZone360 contributor. To read more of his articles, please visit his columnist page.

Edited by Jaclyn Allard

TechZone360 Contributor

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