Motorola Reports Quarterly Loss of $3.6 Billion - Seeks Replacement CFO

Motorola has reported that it generated sales of US$7.1 billion in the fourth quarter of 2008 - and a net loss of US$3.6 billion, driven mainly by write-downs of goodwill and an increase in deferred tax asset valuation reserves. During the quarter, the Company generated positive operating cash flow of $201 million.

For the full year 2008, sales were $30.1 billion, and the net loss was US$2.4 billion.

The Company's outlook for the first quarter is a loss of around US$250-$300 million. This outlook excludes charges associated with the Company's operating expense reduction initiatives, as well as any other items of the variety typically highlighted by the Company in its quarterly earnings releases.

The Company also announced today that its Board of Directors voted to suspend the declaration of quarterly cash dividends on the Company's common stock, effective immediately. The Board believes suspending the dividend will further strengthen the Company's balance sheet and enhance its financial flexibility.

The firm also announced that Edward J. Fitzpatrick, senior vice president and corporate controller, has been named to the additional role of acting chief financial officer, effective immediately, replacing Paul J. Liska, former chief financial officer. The Company has initiated a search to identify a replacement.

No reason was given for Liska's departure.

Mobile Devices segment sales were $2.35 billion, down 51 percent compared with the year-ago quarter. For the full year 2008, sales were $12.1 billion, a 36 percent decrease compared to 2007, and the segment incurred an operating loss of $2.2 billion, compared to an operating loss of $1.2 billion in 2007.

During the quarter, the Company shipped 19.2 million handsets and estimates its share of the global handset market was 6.5 percent.

Sanjay Jha, co-chief executive officer of Motorola and CEO of Mobile Devices, said, "We continue to take appropriate action to address the downturn in the global economy as well as the challenges related to our current Mobile Devices portfolio. We are aggressively developing innovative new products, and we are encouraged by the positive customer feedback on our smartphone roadmap."

Posted to the site on 3rd February 2009