Motorola Mobility posts strong Q4 but warns about Q1

The company, recently spun off from its parent, sold more smartphones in the fourth quarter than in all of 2009

In its first earnings report since becoming a standalone company, Motorola Mobility said it was profitable in the fourth quarter of 2010 and shipped more than twice as many smartphones during the quarter as it did in all of 2009.

However, the company said it expects a net loss of US$26 million to $62 million for the current quarter, indicating that competition in the smartphone market continues to be heated. Executives plan to speak to industry analysts on Wednesday afternoon and may offer more details of the expectations then.

For the fourth quarter, net income was $80 million, or $0.27 per share, compared with a loss of $204 million, or $0.69 per share, a year earlier. Net revenue was $3.4 billion, up 21 percent compared with the same quarter in the previous year.

Motorola Mobility, which separated from its parent company in early January, has two groups: Mobile Devices, which makes phones, and Home, which makes set-top boxes and other IPTV equipment.

Mobile devices generated net revenue of $2.4 billion, up 33 percent year over year. Operating earnings were $72 million.

Net revenue from the Home segment was $1.0 billion, up 1 percent from a year earlier, with operating earnings of $54 million.

Motorola said it shipped 4.9 million smartphones in the quarter, more than double the 2.0 million shipped for the full year of 2009. The company now exclusively uses Android to power its smartphones, a shift from its previous strategy of making devices that ran a variety of operating systems. Still, sales of phones in 2009 were particularly low because it was a transition period for the company, which struggled to come up with a new hot phone after years of relying on its Razr line.

Motorola's Droid handsets and other Android phones have been popular. The company launched seven new smartphones in the fourth quarter. It also recently announced products in new categories, including the Xoom, a tablet that will be one of the first to run Android 3.0, known as Honeycomb. Motorola also announced the Atrix, a phone that pairs with a docking station that has a monitor and keyboard but is portable like a laptop.

Nancy Gohring covers mobile phones and cloud computing for The IDG News Service. Follow Nancy on Twitter at @idgnancy. Nancy's e-mail address is Nancy_Gohring@idg.com

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Nancy Gohring

IDG News Service
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