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Yesterday we ran an earnings preview on mobile device maker Motorola (NYSE: MOT) and asked if the company would be able to break even for its fourth quarter. The answer is no, and shares are trading sharply lower in reaction to the company's weak earnings report.Excluding items, the company lost a penny a share, which was weaker than the break even quarter that analysts had been hoping to see. For comparison purposes, the company was able to earn a positive 5 cents a share for the same period last year.
Sales figures also missed, with a reported $7.14 billion in sales, slightly under the $7.15 billion that Wall Street was hoping to see. This represents a sizable 26% drop in revenues from the same period last year as the company continues to try to fight to maintain market share in the weak cell phone industry.
Investors also got two other pieces of news this morning: the company is going to suspend its dividend and CFO Paul Liska is leaving the company. Liska has been with Motorola since last February.
The company had been paying out a 5 cent quarterly dividend, for a 4.4% annual yield.
Looking at the current quarter, Motorola expects another tough three months, and the company forecast that it would lose somewhere between 10 and 12 cents for the quarter. Analysts had been predicting a 6 cent loss for the quarter.
The stock is trading down 10.35% in mid-morning trading, down $0.47 to $4.07.
As we stated in our earnings preview yesterday, this stock is in an unfavorable downward trend, and would probably not be the best bet to add to your portfolios at this time.
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