Motorola, the world's second largest mobile phone maker, has lowered its forecast for quarterly results due to a shortfall at its mobile devices unit. The earnings warning made late last night fell far below Wall Street expectations.
Analysts said it could be the result of a fiercer price contest between Motorola and its larger rival, Nokia, as well as a greater reliance on emerging markets where cheaper handsets are sold.
Motorola said it now estimates fourth-quarter sales of $11.6 billion to $11.8 billion, compared with its view of $11.8 billion to $12.1 billion, despite investor hopes for more robust sales from its slim Razr phone and new models. Motorola also said it expected to report net income of 13 cents to 16 cents per share, below an internal forecast compiled at the start of the quarter.
Motorola estimated that unit sales in mobile devices rose 48% to 66 million units from a year ago, but said the results fell short of its expectations based on 'an unfavourable mix' of regional and product-type sales. The company did not elaborate further.
