December 07, 2000 07:38
Motorola Expects Lower Than Anticipated Fourth Quarter Sales and Earnings
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SCHAUMBURG, Ill.--(BUSINESS WIRE)--Dec. 7, 2000--Motorola, Inc. (NYSE:MOT) today announced that it does not expect to achieve its earlier guidance for sales and earnings in the fourth quarter of 2000.
Operating profits will not meet earlier guidance in the Semiconductor and Personal Communications segments. Operating profits in the company's Personal Communications Segment are being adversely affected by delays in achieving expected cost reductions in wireless phone production, the company said. In addition, slowing market conditions in the worldwide semiconductor industry, believed to be due to inventory adjustments by customers, are adversely affecting the sales and operating profits of the company's Semiconductor Products Segment.
Sales for the fourth quarter of 2000 are now expected to be $10 billion and earnings per share are now expected to be 15 cents. The earlier guidance given in October was sales of $10.5 billion and earnings per share of 27 cents. Sales in the first quarter of 2001 are currently expected to be $8.8 billion and earnings per share to be 12 cents. These estimates exclude special items.
Motorola said it is completing its normal planning process for the upcoming year and intends to provide sales and earnings per share guidance for the full year 2001 when it announces its final results for the current year, in accordance with its normal practice. The guidance is expected to be lower than the estimates given in October of $44 billion in sales and earnings per share of $1.20.
Motorola began implementing various new cost reduction actions in the third quarter of 2000, which are being followed by additional actions in the fourth quarter of 2000 and will continue in the first quarter of 2001. These actions, which include consolidation of manufacturing operations and out-sourcing of manufacturing, will result in charges against earnings, to be reported as special items, in the fourth quarter of 2000, as well as in the first quarter of 2001. The company also will report gains from the sale of securities in the fourth quarter of 2000.
Motorola continues to expect robust growth in the global wireless telephone market, with unit sales in the range of 525-575 million in 2001, up from an estimated 420 million units this year, and expects to fully participate in that growth. The company also believes that the beneficial impact of cost reductions in its product portfolio of wireless telephones will also be evident by mid-year 2001. The company also believes that the inventory adjustments by semiconductor customers should be completed by mid-year 2001.
Robert L. Growney, president and chief operating officer, said, "Even though it is necessary to reduce our expectations for sales and earnings in the short term, we continue to believe that tremendous long-term opportunity exists at three levels of the value chain - embedded chips, embedded electronic systems and end-to-end integrated communication solutions -- for wireless, broadband and Internet markets. This is the core of our strategic focus."
Motorola senior management will conduct an analyst conference call today at 9.a.m Eastern time, 8 a.m. Central time. A live audio webcast will be available at www.motorola.com/investor. A recording of the call will be available on the website and for replay at 1-402-220-0071.
Motorola, Inc. (NYSE:MOT) is a global leader in providing integrated communications and embedded electronic solutions. Sales in 1999 were $33.1 billion.
Business Risks:
Statements about sales and earnings, cost reduction actions and the impact thereof, unit sales of wireless telephones, and growth in the semiconductor industry are forward-looking and involve risks and uncertainties. The company wishes to caution the reader that the factors below and those on pages F-25 through F-28 of the appendix of Motorola's Proxy Statement for the 2000 annual meeting of stockholders and in our other SEC filings could cause Motorola's actual results to differ materially from those stated in the forward-looking statements. These factors include: (i) the ability of the company to implement its cost reductions in a timely manner and the success of those actions; (ii) worsening market conditions in the company's semiconductor markets; (iii) the impact that lower than anticipated demand worldwide for cellular telephones will have on the company's performance; and (iv) the impact of foreign currency fluctuations on the company, including the impact of the weakening Euro.
CONTACT: Motorola, Inc.
George Grimsrud, 847/576-2346
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Motorola Expects Lower Than Anticipated Fourth Quarter Sales and Earnings
Jump to first matched term
SCHAUMBURG, Ill.--(BUSINESS WIRE)--Dec. 7, 2000--Motorola, Inc. (NYSE:MOT) today announced that it does not expect to achieve its earlier guidance for sales and earnings in the fourth quarter of 2000.
Operating profits will not meet earlier guidance in the Semiconductor and Personal Communications segments. Operating profits in the company's Personal Communications Segment are being adversely affected by delays in achieving expected cost reductions in wireless phone production, the company said. In addition, slowing market conditions in the worldwide semiconductor industry, believed to be due to inventory adjustments by customers, are adversely affecting the sales and operating profits of the company's Semiconductor Products Segment.
Sales for the fourth quarter of 2000 are now expected to be $10 billion and earnings per share are now expected to be 15 cents. The earlier guidance given in October was sales of $10.5 billion and earnings per share of 27 cents. Sales in the first quarter of 2001 are currently expected to be $8.8 billion and earnings per share to be 12 cents. These estimates exclude special items.
Motorola said it is completing its normal planning process for the upcoming year and intends to provide sales and earnings per share guidance for the full year 2001 when it announces its final results for the current year, in accordance with its normal practice. The guidance is expected to be lower than the estimates given in October of $44 billion in sales and earnings per share of $1.20.
Motorola began implementing various new cost reduction actions in the third quarter of 2000, which are being followed by additional actions in the fourth quarter of 2000 and will continue in the first quarter of 2001. These actions, which include consolidation of manufacturing operations and out-sourcing of manufacturing, will result in charges against earnings, to be reported as special items, in the fourth quarter of 2000, as well as in the first quarter of 2001. The company also will report gains from the sale of securities in the fourth quarter of 2000.
Motorola continues to expect robust growth in the global wireless telephone market, with unit sales in the range of 525-575 million in 2001, up from an estimated 420 million units this year, and expects to fully participate in that growth. The company also believes that the beneficial impact of cost reductions in its product portfolio of wireless telephones will also be evident by mid-year 2001. The company also believes that the inventory adjustments by semiconductor customers should be completed by mid-year 2001.
Robert L. Growney, president and chief operating officer, said, "Even though it is necessary to reduce our expectations for sales and earnings in the short term, we continue to believe that tremendous long-term opportunity exists at three levels of the value chain - embedded chips, embedded electronic systems and end-to-end integrated communication solutions -- for wireless, broadband and Internet markets. This is the core of our strategic focus."
Motorola senior management will conduct an analyst conference call today at 9.a.m Eastern time, 8 a.m. Central time. A live audio webcast will be available at www.motorola.com/investor. A recording of the call will be available on the website and for replay at 1-402-220-0071.
Motorola, Inc. (NYSE:MOT) is a global leader in providing integrated communications and embedded electronic solutions. Sales in 1999 were $33.1 billion.
Business Risks:
Statements about sales and earnings, cost reduction actions and the impact thereof, unit sales of wireless telephones, and growth in the semiconductor industry are forward-looking and involve risks and uncertainties. The company wishes to caution the reader that the factors below and those on pages F-25 through F-28 of the appendix of Motorola's Proxy Statement for the 2000 annual meeting of stockholders and in our other SEC filings could cause Motorola's actual results to differ materially from those stated in the forward-looking statements. These factors include: (i) the ability of the company to implement its cost reductions in a timely manner and the success of those actions; (ii) worsening market conditions in the company's semiconductor markets; (iii) the impact that lower than anticipated demand worldwide for cellular telephones will have on the company's performance; and (iv) the impact of foreign currency fluctuations on the company, including the impact of the weakening Euro.
CONTACT: Motorola, Inc.
George Grimsrud, 847/576-2346
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