Yes, we think Motorola co-CEO and the CEO of the company’s Mobile Devices unit Sanjay Jha has no hope.
This morning, Motorola announced its Q4 results and they are UGLY.
Motorola reported a loss of $3.6 billion ($1.57 per share) on sales of $7.1 billion in its fourth quarter ended December 31, 2008.
Following the pathetic performance, Motorola has suspended its quarterly cash dividend on the common stock with immediate effect.
Cell Phones – Horrible
The Mobile Devices unit that Sanjay Jha heads at Motorola is a Katrina-scale disaster.
Mobile Devices sales in the quarter were down 51% to $2.35 billion. The operating loss was $595 million compared to an operating loss of $388 million in the year-ago quarter. For the full year 2008, sales in the Mobile DevicesÂ unit were $12.1 billion, a 36% decrease compared to 2007, and the segment incurred an operating loss of $2.2 billion, compared to an operating loss of $1.2 billion in 2007.
In Q4, Motorola shipped 19.2 million handsets and estimates its share of the global handset market was 6.5%.
Motorola claims it continued to make progress on the smartphone roadmap and is on target to launch next-generation devices during the fourth quarter of 2009.
Well, talk is cheap and we’ve heard this baloney on future progress and improvements before.
Given the phenomenal success of Apple’s iPhone and the challenges from Blackberry, Nokia, Samsung, Android rivals like HTC and the upcoming Palm, it’s hard to believe Motorola has a future in mobile devices unless they come out with a game changing smartphone.
And given all its problems compounded by the recession-hit global economy, we are skeptical that Motorola is going to see a recovery in its Mobile Devices unit any time soon.
Given its collapsing trend, the big question is: Can Motorola’s Mobile Devices unit even survive?
In the usual corporate blah blah blah, Jha said:
We continue to take appropriate action to address the downturn in the global economy as well as the challenges related to our current Mobile Devices portfolio. We are aggressively developing innovative new products, and we are encouraged by the positive customer feedback on our smartphone roadmap.
Not Jha’s Fault
Jha came on board only in August 2008 and is obviously not responsible for much of Motorola’s woes (Jha was previously COO of Qualcomm).
But our point is that the damage done to Motorola by previous management is so severe that we doubt Jha (however smart he may be) can fix Motorola and reap the rich payout.