Motorola sales slump


Motorola sales slump
Mobile phone company Motorola has warned that it expects to report a second-quarter loss as pressure grows upon the group's chief executive to resign.

Sales for the period from April to June are now anticipated to be in the range of $8.6 billion (£4.2 billion) to $8.7 billion (£4.3 billion), the US-based firm warned in a statement today.

Motorola had previously estimated that second quarter sales would total $9.4 billion (£4.6 billion), thus remaining flat compared to the first quarter.

As a result the mobile phone manufacturer is expected to report a loss of between two and four cents a share for the period.

It blamed weakened mobile phone sales in Asia and Europe for the anticipated drop in second-quarter profits.

The number of handsets shipped by Motorola over the period is between 35 and 36 million, down from 45.4 million.

Company officials have now warned that they no longer expect the group's mobile device business to be profitable over the full year.

Decreasing sales mean that Motorola could be usurped as the world's second largest mobile phone retailer by rival Samsung Electronics.

Today's profit warning follows plans already announced by the company to cut 7,500 jobs this year in a bid to cut costs.

Analysts say it is also likely to increase pressure on Motorola chief Ed Zander to resign from the troubled group.

"With this type of performance and the bleak prospects facing the company for the rest of the year, I don't think Zander's tenure is going to go much further," said Ed Snyder, an analyst with Charter Equity Research.

"He's toast," Mr Snyder added.

Motorola is due to publish full results for the second-quarter on July 19th.

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