In late January, Icahn said he had taken a stake in Motorola and would seek a board seat to try to pressure the company into using some of its $11.3 billion cash pile to buy back its shares.
Motorola, the world's second biggest mobile phone maker, said Wednesday it accelerated its share buyback program. However, that news came as the company reported it would post a first-quarter loss in mid-April and shuffle its management in an attempt to turn around its handset business.
Motorola's latest management shuffle included the replacement of its chief financial officer and the appointment of a new president and chief executive.
Motorola's decision to buy back stock was clearly an attempt to appease Icahn, but the company's stock fell to a two-year low on Thursday. The selloff was likely fueled by concerns that there would be no quick fix to the company's latest troubles.
Earlier this week, there had been rumors that Motorola was weighing a takeover of Palm, the maker of the popular Treo smartphone. However, hopes for that deal were dashed by the company's profit warning.