Summary
Motorola, Inc. reported a challenging year for fiscal 2008, marked by a significant decline in net sales and a substantial operating loss, largely attributable to its Mobile Devices segment. The company experienced an 18% year-over-year decrease in net sales, driven primarily by a 36% drop in the Mobile Devices segment. This segment also incurred a significant operating loss of $2.2 billion due to reduced unit shipments, limited product offerings in key areas like 3G and smartphones, and the impact of the global economic downturn. Conversely, the Home and Networks Mobility segment saw a slight increase in net sales and improved operating earnings, while the Enterprise Mobility Solutions segment reported modest sales growth and higher operating earnings. Looking ahead, Motorola acknowledged the difficult economic climate and its impact on demand. The company reaffirmed its commitment to separating into two independent, publicly traded companies but indicated that the previously targeted separation timeline would be delayed due to market conditions. Strategic priorities include simplifying product platforms, focusing on key markets for mobile devices, and investing in next-generation technologies across all segments, while also continuing cost-reduction initiatives.
Financial Highlights
52 data points| Revenue | $25.11B |
| Cost of Revenue | $18.17B |
| Gross Profit | $6.94B |
| R&D Expenses | $3.40B |
| SG&A Expenses | $3.91B |
| Operating Income | -$2.54B |
| Interest Expense | $223.00M |
| Net Income | -$4.24B |
| EPS (Basic) | $-13.11 |
| EPS (Diluted) | $-13.11 |
| Shares Outstanding (Basic) | 323.60M |
| Shares Outstanding (Diluted) | 323.60M |
Key Highlights
- 1Motorola reported a substantial net loss of $4.2 billion in 2008, a significant deterioration from a net loss of $49 million in 2007.
- 2Net sales for 2008 decreased by 18% to $30.1 billion, primarily due to a 36% decline in the Mobile Devices segment.
- 3The Mobile Devices segment continued to struggle, with net sales down 36% and an operating loss of $2.2 billion.
- 4The company estimates its global handset market share declined to approximately 8% in 2008, down from 14% in 2007.
- 5The Home and Networks Mobility segment showed resilience with a 1% increase in net sales and improved operating earnings of $918 million.
- 6The Enterprise Mobility Solutions segment delivered solid results, with a 5% increase in net sales and a 23% rise in operating earnings.
- 7The company recorded significant "Other Charges" of $2.3 billion in 2008, including $1.8 billion in goodwill and other asset impairment charges.