Tech Check

Motorola Warns.  Again

This is becoming the same old story for Motorola, and investors are growing weary.

Motorola, Inc.

The company late today shaved $800 million from its topline guidance, offering a new range of $8.6 billion to $8.7 billion for its second quarter.  Motorola also says it'll post a loss of between 2 and 4 cents, and worse:  its mobile unit will not be profitable for the rest of the year.

"We were expecting the company to do poorly in the second quarter and have repeatedly told clients that Motorola is a late 3Q/4Q turnaround story," Global Crown Capital's Pablo Perez-Fernandez emailed me this afternoon. 

"Upcoming devices like the Zante and recent introductions should position the company for a late comeback this year.  However, the guidance for 35 to 36 million units is lower than we were expecting in Q2. This confirms the persistent rumors that Motorola's market share position is deteriorating due to a weak product line and that Samsung could soon surpass Motorola to take the No. 2 position in the handset industry."

Ouch.  Talk about throwing kerosene onto the Motorola bad news bonfire. Not to mention that Motorola was the single biggest victim from the Apple iPhone release with more Motorola customers jumping ship than any other handset maker.

"We also think that Nokia is another big beneficiary of Motorola's troubles, and we should see the market leader solidify its position as the 800-lbs gorilla when it reports a sequential increase in unit market share in Q2," says Perez-Fernandez.

Motorola's shares closed the Wednesday session fractionally higher on the news, indicating investors aren't all that surprised.  But the stock was down almost 2% in afterhours trading.

Still, with chatter about Ed Zander's departure once again increasing the decibel level, Motorola may be worth careful scrutiny these next few days.

Questions?  Comments?