NEW YORK -(Dow Jones)- Motorola should post solid fourth-quarter results Thursday as its trendy RAZR phones continues to propel sales in an already hot handset market.
The Schaumburg, Ill., telecommunication equipment and handset maker will report its fourth-quarter results after the close of the market Thursday. Analysts, on average, project earnings of 34 cents a share and revenue of $10.5 billion.
Motorola's flagship RAZR lineup, expanded via different colors and availability to new carriers, helped the company retain its top spot in North America and maintain its second place standing in Europe.
"Motorola should show solid results driven by continued momentum from the Razr," Citigroup analyst Daryl Armstrong said in a note. "In addition, we expect management to provide constructive guidance as the company benefits from a strong handset market, continued support from the Razr, and recent product introductions."
A spokeswoman for Motorola declined to comment on Wall Street's financial expectations.
Growth in the emerging markets, meanwhile, continues to fuel sales in the other regions. Motorola's steady hold over the number two position in the world is vital as rivals such as Nokia, Samsung, and LG Electronics jockey for market share. Handset sales will likely exceed expectations, led by growth in Eastern Europe, the Middle East, Africa, Asia and Latin America.
"Emerging market growth is once again the primary driver," Lehman Brothers analyst Tim Luke said of the global handset market.
The growth in the emerging markets will likely take its toll on the industry average selling price for cell phones. Motorola, which is making aggressive strides into those regions, should bear its fair share of that price decline.
Still, much of that decline should be offset by the more expensive feature-laden phones sold in the developed nations. The need to replace or upgrade to a third-generation phone is driving the growth in North America and Western Europe.
Analysts will also be looking for comments on the first quarter, which should see contributions from new phones such as PEBL and SLVR.
The company should also see a more solid contribution from its new RAZR phone that is compatible with carriers Alltel and Verizon Wireless. The new model was released in November for Alltel customers, and in December for Verizon Wireless VCast users. The prior RAZR could only by used by carriers such as Cingular.
While optimistic over the new RAZR, Armstrong said he was more concerned about the lack of industry buzz over new phones such as the SLVR. He said the SLVR phone is key to capturing market share in the mid-teen demographic in Western Europe. The company has said in the past that capturing share in the region is a priority.
Armstrong doesn't own a stake in Motorola, but Citigroup has an interest in the stock, and has an investment-banking relationship with the company.
Positive results from rivals Samsung and Sony Ericsson, as well as bullish expectations from the adoption of 3G phones, have also heightened expectations for Motorola.
Motorola recently traded at $23.38, down 14 cents, or 0.6%, on volume of 6 million shares. Average daily volume is 18 million shares.
-By Roger Cheng, Dow Jones Newswires; 201-938-2020; firstname.lastname@example.org
(END) Dow Jones Newswires "
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