Motorola issues profit warning

By Editorial Team (Thursday, 12th July 2007)

Mobile phone company Motorola has forecast a second quarter loss and claimed it will not make a profit in 2007, it has emerged.

The firm's sales during the second quarter were eight per cent lower than expected, with the world's second-largest phone manufacturer blaming poor handset sales across Asia and Europe for its drop in revenue, Reuters reports.

Since the announcement of uninspiring profits for the fourth quarter of 2006, speculation has grown that the firm's chief executive Ed Zander may resign and allow someone else to take the reigns and turn around the company's fortunes

The situation did not improve in 2007, with Mr Zander commenting in March: "The performance in our mobile devices business in the first quarter is unacceptable and we are committed to restoring it to an appropriate level of profitability."

Motorola's last popular handset was its Razr model, a slim and stylish phone which is still in demand today but no longer commands a top-end market price, the Guardian reports.

In addition, the development of a specialist music phone in collaboration with Apple was overshadowed by the launch of the much-anticipated iPhone.

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