The company on Thursday (Oct. 30) announced a loss of $397 million for the September quarter and said the separation of its two major business divisions would no longer occur in the third quarter of 2009 as previously planned.

It did not announce a new date for the spin off but said it will immediately introduce another round of reorganization efforts to cut costs.

"While our strategic intent to separate the company remains intact, we are no longer targeting the third quarter of 2009, primarily due to the macro-economic environment, stresses in the financial markets and the changes underway in mobile devices," said Sanjay Jha, co-CEO of Motorola and head of the wireless division in a statement.

"We have made progress on various elements of the separation plan and will continue to prepare for a potential transaction at the appropriate timeframe that serves the best interests of the company and its shareholders," Jha added.

That date may be a long time coming especially as the company continues to face strong headwinds in its core businesses even as rivals encroach on its turf worldwide.

Motorola said it would in response to continuing challenges in its operations seek to implement additional cost reduction measures that will result in annual savings of $800 million in 2009.

"While we will continue to prioritize investments on opportunities for growth, we are also improving our cost structure across the company by implementing further cost reductions," said Greg Brown, co-CEO of Motorola and CEO of its broadband solutions division. "The initiatives announced today, together with prior actions, will result in total estimated annual savings of $800 million in 2009."

In the just ended quarter, Motorola reported a net loss of $397 million, or 18 cents per share, compared with net profit of $60 million, or 3 cents per share, in the third quarter of 2007. Revenue fell 15 percent in the most recent quarter to $7.5 billion from $8.8 billion in the third quarter of 2007.

The company continued to face declining demand for its wireless handsets with shipments dropping to 25.4 million units in the third quarter, down from 28.1 million units in the second quarter. The division's sales tumbled 31 percent to $3.1 billion from $4.5 billion in the prior year quarter.

Motorola's two remaining divisions performed slightly better with sales in the home and networks mobility business staying relatively flat at $2.37 billion compared with $2.39 billion in the third quarter of 2007. Sales in the enterprise mobility solutions group increased 4 percent on a year-over-year basis to $2.03 billion from $1.95 billion.

By: DocMemory
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