Wednesday, March 12, 2008
Thursday, January 31, 2008
Motorola may separate cell phone unit
Struggling cell-phone maker Motorola Inc. said Thursday it is considering separating the handset unit from its other businesses in an effort to snap a deep slump that has followed its meteoric success with the Razr.
The announcement after the stock market closed sent its shares up more than 10 percent.
It came amid speculation that the Schaumburg-based company may sell or spin off the cell-phone business after more than a year of dismal results and declining market share.
The company's other two businesses are the home and networks segment, which sells TV set-top boxes and modems, and enterprise mobility solutions, which sells computing and communications equipment to businesses.
Motorola said in a statement that separating the mobile devices business would "permit each business to grow and better serve its customers."
"We are exploring ways in which our mobile devices business can accelerate its recovery and retain and attract talent while enabling our shareholders to realize the value of this great franchise," Chief Executive Greg Brown said.
The announcement temporarily brought after-hours trading in Motorola stock to a halt. Shares rose 21 cents to $11.50 in the normal trading session -- down 28 percent in 2008 and 56 percent since hitting a six-year high of $26.30 in October 2006. The shares were up $1.18 in extended trading.
Brown, who took over Jan. 1 following Ed Zander's resignation, last week bluntly portrayed a lack of progress toward a recovery when discussing Motorola's weak fourth-quarter results. The company's profit fell 84 percent, handset sales were down 38 percent, and he said its share of the world handset market continues to fall after being reduced by nearly half since hitting 23 percent at the end of 2006.
The announcement after the stock market closed sent its shares up more than 10 percent.
It came amid speculation that the Schaumburg-based company may sell or spin off the cell-phone business after more than a year of dismal results and declining market share.
The company's other two businesses are the home and networks segment, which sells TV set-top boxes and modems, and enterprise mobility solutions, which sells computing and communications equipment to businesses.
Motorola said in a statement that separating the mobile devices business would "permit each business to grow and better serve its customers."
"We are exploring ways in which our mobile devices business can accelerate its recovery and retain and attract talent while enabling our shareholders to realize the value of this great franchise," Chief Executive Greg Brown said.
The announcement temporarily brought after-hours trading in Motorola stock to a halt. Shares rose 21 cents to $11.50 in the normal trading session -- down 28 percent in 2008 and 56 percent since hitting a six-year high of $26.30 in October 2006. The shares were up $1.18 in extended trading.
Brown, who took over Jan. 1 following Ed Zander's resignation, last week bluntly portrayed a lack of progress toward a recovery when discussing Motorola's weak fourth-quarter results. The company's profit fell 84 percent, handset sales were down 38 percent, and he said its share of the world handset market continues to fall after being reduced by nearly half since hitting 23 percent at the end of 2006.
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