Motorola posts loss, awaits Google deal approval
Mobile phone maker Motorola Mobility Inc posted a fourth quarter loss on weak revenue on Thursday in what could be its last report before a planned takeover by Google Inc.
Some Google investors have worried about the search company's decision to buy Motorola Mobility since it warned on January 6 that revenue would fall well short of Wall Street expectations due to legal costs and tough competition from rivals such as the Apple Inc.
The companies are still seeking approval for the deal which is being reviewed by regulators around the world. Motorola Mobility reported a net loss of $80 million, or 27 cents per share, compared with a profit of $80 million, or 27 cents per share, in the same quarter the year before. Revenue barely rose to $3.436 billion from $3.425 billion in the year ago quarter.
Set-top box revenue fell 11 percent from the year-ago quarter to $879 million, while revenue from mobile devices rose 5 percent to $2.5 billion.
Google agreed in August to buy Motorola for $12.5 billion, or $40 per share. It wants to get hold of the cellphone maker's patent portfolio to help defend itself and other Android phone manufacturers in patent infringement cases brought by rivals such as Apple and Microsoft Corp.
Motorola Mobility still expects the Google deal to close early this year. The companies are awaiting approval from regulators in several countries, including the United States,
China, Europe and Canada.
Motorola said China started phase two of its investigation in December and the European Commission is not expected to announce until February whether or not it will expand its review. The deal also requires approval from Israel and Taiwan, according to Motorola Mobility, which said that
Russia and Turkey have already given their approval.
Since Motorola shares are trading close to the offer price, Morgan Keegan analyst Tavis McCourt said investors appear confident the deal will be approved.
Motorola shares closed up 7 cents at $38.67 on New York Stock Exchange.
After losing ground in the smartphone market for several years, Motorola Mobility was separated from Motorola Inc last year when the company, credited with inventing the cellphone, split in two.
Source: Reuters