Mobile phone manufacturer, Motorola, has seen it’s sales in handset drop by almost 40% in the first quarter on 2008. It also announced a loss of almost £100 millions compared to just under £90 million the same time last year. Overall, their net sales have dropped by £2 billion in the last 12 months.
In March the company floated the mobile phone branch of it’s business due to pressure from Carl Icahn, who owns over 6% of stock. Icahn is hoping that the company can regain profits by running it’s network business separately from it’s mobile device sector.
One reason for the sharp fall in sales in the failure to follow up the success of it’s Razr phone, which tasted global popularity.
Motorola’s three business units all fell short of expected forecasts. Though it wasn’t all doom and gloom, as it’s division that sells computer and telecoms equipment to businesses saw it’s profits rise by almost 10% in the first quarter. Overall, company shares have fallen 65% since the fourth quarter of 2006, which has left investors feeling insecure.
Motorola are not the only telecoms company to experience a slowdown. Sony Ericsson announced a sales slump of 8% meaning that it has fallen down to 5th place in the global market. In contrast, Nokia has seen an overall rise in sales due to emerging markets, whilst it still struggles in the European and American markets.
The Apple iphone is another company bucking the trend but announcing sales of over 1.5 million handset in the first quarter. LG are also in buoyant mood by announcing that it is about to launch the third phone in its Black Label – their high-end touch screen range. The previous two models have helped it sell over 20 million units worldwide and have contributed to the company selling almost 25 million handsets in the first quarter.
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