Insightful analysis and commentary for the US and global equity investor
Contributors: Douglas McIntyre Jon C. Ogg

Previous Posts

Wednesday, October 18, 2006

Motorola: It Will Get Worse

Motorola disappointed with its Q3 earnings. Among other things, cell phone sales missed expectations.

I may get much worse. Several analysts and cell companies say that yield-per-phone revenue should drop in Q4 and the growth rate of sales of cell phones overall will drop next year and in years beyond.

Motorola bet big on the RAZR and won big. But, the air is coming out of that ballon. Q3 profits dropped 45% from the same period last year. Wall St. has loved the company over the last couple of years. Motorola’s stock has raced from $8 in mid-2003 to the current level of $26. (The stock was down 7% after hours).

The company’s next big bet may be on WiMax which is being deployed by Sprint and other companies worldwide, but revenue from that may not kick in for two years.

In the meantime, Motorola has a problem.

Douglas A. McIntyre can be reached at He does not own securities in companies that he writes about.

Powered by Blogger