Motorola 3Q Net Surges On 26% Sales Increase

SCHAUMBURG, Ill. -(Dow Jones)- Motorola Inc. (MOT) posted a fourfold increase in third-quarter net income on strong sales of new handset models, which pushed revenue up 26%.

In a press release Tuesday, the telecom-equipment maker also gave a fourth-quarter revenue forecast which brackets Wall Street's estimate.

Third-quarter net income rose to $479 million, or 20 cents a share, from $116 million, or 5 cents a share, a year earlier.

Results for the latest quarter include a gain of $195 million, or 5 cents a share, from the sale of investments, a charge of $81 million, or 2 cents a share, for debt retirement, charge of $67 million, or 3 cents a share, for the impairment of goodwill, a charge of $55 million, or 1 cent a share, for severance charges, a tax benefit of $39 million, or 2 cents a share, a charge of $19 million, or 1 cent a share, for Freescale Semiconductor Inc. (FSL) separation costs.

Earnings for the year-ago quarter include charges of $27 million, or 1 cent a share.

In July, Motorola predicted GAAP earnings per share in the range of 15 cents to 19 cents a share, excluding a portion of the expected results of the company's semiconductor operations related to the Freescale Semiconductor Inc. initial public offering.

Revenue was $8.62 billion, up from $6.83 billion a year earlier. Motorola had expected revenue of $8.4 billion to $8.8 billion.

Analysts polled by Thomson First Call, on average, expected the company to post earnings of 19 cents a share on revenue of $8.68 billion.

Motorola shares closed at $18.50, down 22 cents, or 1.2%. Shares fell to $17.85 in after hours trading, according to Inet.

Looking ahead, Motorola projects net income of 23 cents to 26 cents a share on sales of $9.3 billion and $9.6 billion for the fourth quarter. The company said fourth-quarter net income will reflect income from special items of $198 million, or 3 cents a share.

Analysts polled by First Call, on average, expect earnings of 24 cents a share on sales of $9.52 billion for the period.

In the year-earlier quarter, Motorola earned 20 cents a share, including a gain, on sales of $8.02 billion.

(MORE) Dow Jones Newswires "

Posted to the site on 19th October 2004