An important player in the mobile phone market a couple of years back, Motorola has entered a slippery slope of financial losses and, unfortunately, the company doesn’t seem to be able to pick things up anytime soon.
After reporting losses for four consecutive quarters in 2011, Moto seems to have started 2012 in similar fashion, and is today announcing a net $86 million deficit for January through March. What’s interesting is that the company’s mobile unit has been – by far – the black sheep, accounting for a $121 million loss, while the home segment has managed to cover a small part of that loss with a $35 million profit.
Motorola’s home segment actually made significant progress, and managed to pull in $15 million more in profit than the first quarter of 2011. The company’s overall loss, however, is a worrying trend, as it has escalated from $56 million in Q2 2011, to $80 million in Q4 2011, and is at a whopping $86 million now.
As for total revenue, things are themselves not very bright for Motorola. The US-based company has reported net revenues of $3.1 billion in Q1 2012, down $0.2 billion from Q3 2011 and $0.3 billion from last year’s final quarter. On the other hand, the Q1 revenue was up 2 percent compared to the first quarter of 2011, so things are not quite disastrous for Moto.
8.9 million Motorola mobile devices were shipped from January to March worldwide, with 5.1 million of these being smartphones. That’s a significant decrease in comparison with last year’s final quarter, when Moto shipped 10.5 million devices, and a slight, but important drop year-on-year as well (there were approximately 9.3 million devices shipped by Motorola in Q1 2011).
Another important aspect of Motorola’s most recent report and the one that I think should be noted the most is that the company actually lost a huge pile of money on account of the pending merger with Google. All the banking and legal fees Moto had to spend for the merger to be approved resulted in about 21.5% of all the electronic giant’s losses for the quarter.
Google’s acquisition is yet to be fully official and approved, as most of you might know, with the Chinese go-ahead of the transaction being delayed for unknown reasons. The US and EU approvals have been granted, but Motorola and Google need to receive approval from China in order for the new company to be officially “born”.
Moto officials state in the financial report that they expect the acquisition to be completed by the middle point of this year. That’s in less than two months, if my calendar is not mistaken, which is, in my opinion, a very optimistic forecast from Motorola.
It’s going to be interesting to see what Google’s plans are for turning Motorola around, as it’s pretty obvious that the Droid RAZR MAXX makers have serious problems in their mobile (and marketing) departments. We’ve been reporting here on the site on several rumors about Google’s plans for Moto’s hardware unit, but nothing is for the moment confirmed.
Regardless of all of this negativity, I think you will agree that Motorola makes very high quality devices, and benefits the Android ecosystem at large. What do you guys think? Can Google make Motorola rise from its own ashes before the end of 2012? Will the merger actually get approved as soon as Moto is hoping? Hit us with a comment and let us know your opinions!