Moto X exciting for Larry Page, Motorola financial performance probably not so much

July 19, 2013

Rogers Moto X video leak

Google’s CEO revealed during the company’s Q2 2013 earnings conference call that he’s “really excited” for the upcoming Moto X, although it’s not all good news for Motorola, especially when looking at its financial performance.

Page revealed during his remarks that he has been a tester of the Moto X for a while, without specifically naming the device. However, he did not mention any details regarding the announcement of the handset in his prepared speech.

During the questions session, Page was asked about that rumored half a billion Moto X advertising budget but he did not confirm or deny the number. Instead he said that Google is “doing things that are normal for that business,” adding that that “probably too much has been made” about it in the news.

The CEO also hinted that Motorola is an independent company when asked “how Google was walking that fine line between wanting the Moto X to be a success but not such a success that it affects major Android partners like Samsung.”

Motorola, however, is yet to be the successful company Google probably wants it to be. Google CFO Patrick Pichette says that “a lot of progress” has been made at Motorola, but when looking at the numbers you’ll see that the company is still in the red.

Larry Page

Despite being a Google subsidiary, the company is yet to be come a profitable Android player, and the losses continue to accumulate for Google on top of the initial $12.5 billion it paid to acquire it.

In Q2 2013, Motorola posted a loss of $342 million, 75% bigger than its Q2 2012 loss, despite revenue increasing 18% compared to the same period last year to $998 million.

CNET speculates that much of the posted loss may be tied up with the company’s investment in its U.S.-based smartphone factory that will mass-produce the Moto X, and probably other mobile devices in the future.

Motorola has halved its workforce in the past quarter, registering 4,599 workers at the end of Q2 2013 compared to the 9,982 employees that were working for the company at the end of the first quarter. At the same time, the U.S. factory will hire more than 2,000 employees that will be working on those Moto X units.

With the Moto X expected to be a low-cost device, it’ll certainly be interesting to see how Motorola performs in the coming quarters. The device won’t be the only new smartphone the company will launch as three Android-running beasts will join the Moto X this summer, all of them expected to be unveiled by Verizon during a special event next week.

Comments

  • Ryan

    Verizon is the life support. Thanks to the DROID Series.

    • Lisandro O Oocks

      Even though true, sometimes like in this case the biggest customer can be your biggest hurdle. Having one big customer means they can call the shots and squeeze you until you give. Google has enough experience in this type of scenario so hopefully that experience can be transferred to Motorola.

    • cycad007

      You’re clueless and have no idea what you’re talking about. Verizon Wireless is going strong…they just announced strong subscriber growth & their stock price is up approx. 15% YTD. Do your research before spouting out nonsense. Just because you feel like they don’t support Android, they don’t have the latest phones, etc…does NOT mean they aren’t successful. They are making a killing.

      • jjordan

        I think the point he was trying to make is that carrier exclusives can kill an oem. The main reason samsung has so much success is because of marketing of course but also it doesnt matter what network you use, you can go to your provider and buy that nice shiny samsung device you’ve seen a thousand ads for.

      • Clown Biscuits

        Take a minute, step back, and re-read what he said. Then read your reply.

      • AnGeLFaCe77

        you are a fool. He was defending Verizon

  • Tamadrummer94

    There is more hype surrounding this device than any Android phone I’ve seen in a long time.

    • Android wins!

      At the end, this probably won’t be that superphone that everybody expects to see.

      • bozs13

        None of the “leaks” say it’ll be a superphone. Actually, they flat out mention that it will be mid spec. If people expect something more, then that’s their fault lol

        • Android wins!

          In the beginning, if I remember well, every single leak claimed Moto X to be a superphone. But I now see, that it won’t be really true.

    • bozs13

      It’s more hype for us nerds than anything else. Not ad campaigns on TV or on the internet that most people will see. Only we, the ones that follow tech specific and android specific news really know anything about the mere existence of such a phone.

      • Android wins!

        I’ve read somewhere, that Motorola wants to spend $500 Million for Moto X advertisement. But it was just a rumor.

        • bozs13

          And I hope they do! They really need to push this phone and get it out there, get people excited :)

          • Android wins!

            Just like Sammy did with the Galaxy Line. Marketing really counts. How would iPhone sell, when there wasn’t any advertisement? It’s a crappy phone.

  • AnGeLFaCe77

    Moto X will be the best device of 2013

    • bozs13

      I hope so

      • AnGeLFaCe77

        This device will amaze you.

    • jamesinkorea

      Nope….Not even close to being the best.

      • AnGeLFaCe77

        I will teach you about technology

  • rabidhunter

    When I look at cars in my city, I see a bunch of Ford Focus and Chevy Cobalt and older cars. Sure, I see a lot of Mustangs, Corvettes, and the occasional Porche, but the vast majority of vehicles in my city were in the midrange.
    What does that have to do with the Moto X? If they price it lower, it has the potential to sell big.

    • bozs13

      Porche? SACRILEGE

      Next time Porsche please :)

      -Your friendly resident Porsche fanatic

      • rabidhunter

        Edited