Money Matters - Simplified

Motorola Mobility revenue dips in fourth quarter

Motorola Mobility registered dip in revenue, share prices remain unharmed after the news.

Motorola Mobility registered dip in revenue in the fourth quarter due to the increased competition in Smartphone market.

Motorola which is in middle of a deal with Google raised concerns after its Smartphone share also declined in the fourth quarter. 200,000 tablets were sold by the company in the fourth quarter which is a major reason for the loss in revenue.

Motorola which use Google’s android operating system faced stiff competition from rivals such as Apple’s iPhone and iPad.

The quarterly earnings report of Motorola states the loss of $3.44 billion, whereas in the same period previous year Motorola registered the profit of $80 million on $3.43 billion in revenue.

Motorola’s reaction

Though financial statements are in negative but, Motorola is not much troubled by it. CEO of Motorola Sanjay Jha said Motorola received positive response from the customers in fourth quarter with the innovative Motorola Razr.

Sanjay Jha said, “In the fourth quarter, we received very positive consumer response to Motorola Razr, which combined an iconic brand with ultra-thin in an innovative Smartphone.”

Shareholders worried

Motorola might not be worried about decrease in sale but Google’s shareholders are worried about it. Google and Motorola have reached on a deal, in which Google pays $40 per share to Motorola for the patents portfolio and devices.

However, the deal is wedged in countries such as US, Europe, China, and Russia well for regulatory approvals. Sanjay Jha said, “We remain energized by the proposed merger with Google and continue to focus on creating innovative technologies.”

Rise in share!

Though the financial statement was not favorable, still Motorola Mobility shares closed up with 7% increase to $38.74 in extended trading session and in normal session they were up as well.

The reason for the increase is Google whose share buying offer is still with Motorola.