Motorola 1Q loss widens, but beats Street

NEW YORK — Motorola Inc. defeated low expectations Thursday, posting a smaller first-quarter loss than Wall Street had expected and regained its position as the world’s fourth-largest maker of cell phones.

The Schaumburg, Ill.-based company reported a loss of $231 million, or 13 cents per share for the first three months of the year. That’s wider than the loss of $194 million, or 9 cents per share, for the same quarter last year.

The loss for the latest quarter included charges of 5 cents per share, bringing the loss from continuing operations excluding items to 8 cents per share.

On average, analysts expected a loss of 11 cents per share, excluding items, according to Thomson Reuters.

Motorola’s sales were $5.4 billion, down 28 percent from $7.5 billion a year ago. Analysts were expecting sales of $5.6 billion.

Motorola shares rose 24 cents, or 4 percent, to $6.20 in pre-market trading. The stock has already been on a tear, rising 71 percent since early March.

Motorola sold 14.7 million handsets. That’s just over half of what it sold a year ago, but it beat Sony Ericsson’s sales in a difficult quarter. Nokia Corp., LG Electronics Inc. and Samsung Electronics Co. still sell more phones.

Motorola also said it increased its annual savings target by $200 million to $1.7 billion, most of which is coming from the cell phone division. That division has already been the target of big cuts, and it reduced its operating loss for the quarter to $509 million from $595 million in the fourth quarter.

The head of the handset division, Sanjay Jha, said the company was still on track for a fourth-quarter launch of new “smart” phones, a category where the company hasn’t been competitive. The phones will use Google Inc.’s Android software.

Sales at Motorola’s non-cell phone units were also down, but both were profitable.

Home and Networks Mobility, which makes wireless network and cable system equipment, saw sales drop 16 percent.

At Enterprise Mobility, which makes police radios, bar code scanners and other equipment for government and corporate customers, sales were down 11 percent.

For the current quarter, Motorola expects a loss from continuing operations of 3 cents to 5 cents per share, excluding charges for cost-cutting initiatives. Analysts had been expecting a loss of 5 cents per share.