Motorola Inc is finally benefiting from the upturn in IT spending and has announced earnings of $489m, up from $174m, for the fourth quarter to December 31, on revenue 4.2% higher at $8bn. For the year, the company reported net income of $893m, up from a loss of $2.48bn on revenue 0.8% lower at $27bn.
However, new CEO Mike Zander said he is planning a further attack on a cost structure that has hobbled the performance of the electronics conglomerate. He told a conference call: I think there’s a lot of low-hanging fruit that we can go after in terms of our cost structure and our resources.
Zander described Motorola as a company with great potential and said he was delighted to have joined it at an important next stage in its evolution. Motorola’s failure to fulfill its potential is clear from the performance of its personal communications segment, where it holds second place to Nokia in a buoyant market.
Sales in the fourth quarter were down 3% at $3.3bn, which the company blamed on delays in introducing several new products. Operating earnings for the quarter more than halved to $127m and were down 4.7% at $479m for the year.
At its semiconductor division, sales for the fourth quarter rose 2% to $1.4bn, with the networking market providing most of the growth. A recovery in spending by carriers enabled its telecoms solutions segment to increase fourth-quarter sales by 11% to $1.4bn and the business bounced back into profit with operating earnings of $138m, compared with a loss of $22m a year earlier.
Homeland securities initiatives helped the commercial, government and industrial solutions segment to increase sales by 5% to $1.2bn, while the integrated electronic systems segment increased sales 17% to $669m.
This article is based on material originally published by ComputerWire