Motorola loses $3.6bn in last quarter

Motorola has announced that it made a loss of $3.6bn for the last quarter of the year, with the mobile division’s sales faring particularly badly.

In its earnings announcement the company said that in the last quarter it had lost $3.58bn, compared to a $100 million profit last year. The company has suspended its dividend and chief financial officer Paul Liska has resigned.

Greg Brown, Motorola’s president of Broadband Mobility Solutions, and Sanjay Jha, chief executive officer of Mobile Devices, said, “In the fourth quarter, we generated positive operating cash flow of $201 million and ended the year with total cash of $7.4bn.”

“In light of the economic climate and challenges we face, we have implemented aggressive measures to reduce costs and improve financial flexibility, particularly in Mobile Devices. The cost-reduction actions underway are expected to generate aggregate savings of approximately $1.5bn in 2009,” added Brown and Jha.

The mobile handset division fared particularly poorly, with sales down 51 per cent compared to a year ago. The division lost $595 million in the fourth quarter, compared to a loss of $388 million last year.

While the company said it was still committed to Windows Mobile, but was also looking to phones using Google’s Android operating system in future models.

“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,” said Jha.

“We are aggressively developing innovative new products, and we are encouraged by the positive customer feedback on our smartphone roadmap.”

By contrast Motorola’s Enterprise Mobility Solutions division saw sales up four per cent at $2.2bn and sales at the Home and Networks Mobility division fell just five per cent.

The company said that it did not expect the next quarter to be much better and further losses were almost certain. The company announced it was cutting 4,000 staff in January.