Summary
This Form 8-K filing by Motorola, Inc. (MSI) on April 9, 2002, primarily serves as an explanatory note regarding significant changes in its financial statement presentation starting in the first quarter of 2002. These changes are designed to align Motorola's reporting more closely with that of other technology companies and do not alter the company's previously reported historical results. Key adjustments include the renaming of "Manufacturing and other costs of sales" to "Costs of sales," the introduction of a "Gross margin" subtotal, and the addition of an "Operating earnings (loss)" subtotal that consolidates various operating expenses. Furthermore, the filing details reclassifications of depreciation expense, interest income/expense related to Motorola Credit Corporation (MCC), and foreign currency/affiliated company earnings. These reclassifications will be reflected in specific new statement lines to improve clarity and comparability. Investors should note that while the presentation is changing, the underlying financial performance remains consistent with prior disclosures. The sole purpose of this 8-K is to provide reclassified financial statements reflecting these changes.
Key Highlights
- 1Motorola is adopting new financial statement line items and reclassifying certain expenses starting in Q1 2002 to align with industry peers.
- 2"Manufacturing and other costs of sales" is now "Costs of sales," including manufacturing depreciation.
- 3A new "Gross margin" subtotal (Net sales minus Costs of sales) has been introduced.
- 4An "Operating earnings (loss)" subtotal is now presented, combining Gross margin with operating expenses.
- 5Depreciation expense will no longer be a separate line item; it will be allocated to "Costs of sales" or operating expenses.
- 6Interest income/expense from Motorola Credit Corporation (MCC) will be reflected in "Interest expense, net," differing from prior inclusion in Net sales and Costs of sales.
- 7The filing's primary purpose is to present reclassified financial statements and segment information for comparability.