Motorola reduces Q4 and full-year outlook

Motorola said today that it expected fourth quarter sales to reach about $7.1 billion, a 5.3% decrease from previous guidance of $7.5 billion. Sales for the full year 2003 are expected to reach about $27.5 billion, down 5.2% from the previous guidance of $29 billion.

The company also estimated that GAAP (generally accepted accounting principles) earnings per share for fourth-quarter 2002 would be about four cents, with full year GAAP EPS totaling about 10 cents. These figures compared to previous guidance of 10 cents per share for fourth-quarter 2002 and 14 cents per share for the full year. Estimated GAAP earnings for the fourth-quarter included net charges of about $200 million related to previously announced restructuring actions.

The company said its lowered revenue and earnings guidance is driven by slowing demand in a number of its end markets, specifically the wireless infrastructure, broadband and semiconductor businesses.

Yesterday Motorola announced third-quarter 2002 earnings of six cents per share, excluding special items, which beat the five-cents-per-share estimate of analysts polled by Thomson-First Call. The results represented a significant improvement over the seven-cents-per-share loss posted in the year ago quarter. However, sales for the quarter only reached $6.4 billion, a 14 % decline year-over-year from the 7.4 billion posted in third-quarter 2001.

Motorola President Mike Zafirovski said in a statement that the positive earnings results for the third quarter were the result of an increased focus on its customers, and an aggressive and timely restructuring the company began two years ago. – Glenn Bischoff, senior writer.--Glenn Bischoff, senior editor