Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

Summary: Motorola Mobility topped Wall Street expectations for the second quarter, but it could still be doing better. Meanwhile, the company's earnings outlook fell short of expectations.

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TOPICS: Hardware, Mobility, Wi-Fi
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Motorola Mobility topped Wall Street expectations for the second quarter, but it could still be doing better. Meanwhile, the company's earnings outlook fell short of expectations. Motorola Mobility reported a GAAP net loss of $56 million, or 19 cents a share, for the second quarter (statement). Non-GAAP earnings were nine cents a share on a revenue of $3.3 billion. Wall Street is looking for Motorola Mobility to report Q2 earnings of six cents a share on revenue of $3.12 billion.

MMI's chairman and chief executive officer Sanjay Jha said in a statement:

In the second quarter, Mobile Devices launched several new smartphones in the U.S. and markets around the world. Revenues grew over 40 percent driven largely by Latin America and China where sales more than doubled year over year. Our Home business delivered another strong performance, and we introduced several innovative products and services for next generation multi-screen video solutions.

With a focus on profitable growth and delivering differentiated LTE smartphones and tablets, we expect to achieve profitability in Mobile Devices in the fourth quarter and for the full year 2011.

The big story for Q2 was mobile product shipments. Most analysts predicted MMI to ship approximately 4.3 million Android smartphones and 300,000 Xoom units during the second quarter. Motorola blew past that with 11 million mobile devices shipped, including 4.4 million smartphones and 440,000 Xoom tablets.

However, Motorola did not disclose any specific numbers regarding how many of those units were actually sold to end users.

Motorola promises even bigger numbers next quarter with several new releases - most notably the Droid Bionic this September along with another 4G LTE-enabled smartphone before 2012. Motorola is aiming to expand its growing presence in emerging markets with more sub-$200 handsets.

Additionally, two more unnamed tablets, one with a display measured at 10.1-inches to competed with the Samsung Galaxy Tab 10.1 as well as a smaller version, will also debut in the next few months. The Xoom will also get its upgrade to LTE in September.

By the end of the year, Motorola expects to have shipped 21 to 23 million mobile device units, including 1.3 to 1.5 million tablets.

For the outlook, Motorola Mobility is predicting non-GAAP earnings between zero to 10 cents a share at the end of Q3. Wall Street is expecting Motorola Mobility to report a profit of 24 cents a share on revenue of $3.37 billion. For the fourth quarter, the company was expecting 47 cents a share on revenue of $3.84 billion.

For 2011, Motorola Mobility is promising report earnings of 48 to 60 cents a share. Wall Street is looking for earnings of 71 cents a share on revenue of $13.33 billion.

Shares took a hit in afterhours trading.

Key points:

  • Expanded distribution of the Atrix 4G smartphone and Motorola Xoom tablets in Latin America, China, Korea, and Europe
  • Named exclusive U.S. launch marketing partner for mobile devices and tablets by Spotify
  • Introduced Motorola Televation, a broadband video device for watching live TV on a connected IP device anywhere in the home
  • Selected by ESPN to transition all programming for ESPN and ESPN-2 networks to the MPEG-4 HD format using Motorola’s video distribution solution

By the numbers:

  • Total cash at the end of the quarter: $3.2 billion
  • Mobile Devices net revenue: $2.4 billion, up 41 percent compared with Q2 2010
  • Launched 4 new smartphones in China, including the Motorola XT883 with China Telecom
  • Announced plans to launch 10 devices in 2011with Sprint, including Motorola Photon 4G this weekend

Related:

Topics: Hardware, Mobility, Wi-Fi

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23 comments
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  • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

    11 million phones shipped...4.4 million fo them Android smartphones...and they still make a loss! I guess their "bet the company on Android" is not the panacea they were hoping for. Not sure how they are going to dig themselves out of this hole. At best I can see them breaking even but that will be for the rest of the Android handset makers too.
    So many people want to talk about how the PC industry is going to repeat itself with the mobile phone market. and how that is a good thing. If I was a Android manufacturer I wouldn't be thinking it was such a good thing because you will be doomed to razor thin margins and having to focus on how to increase sales by .1% rather than focusing on expanding and developing a great ecosystem. Remember that most PC manufactureres did not last through the 90's and 00's.
    global.philosopher
    • I agree with you .... but ...

      @global.philosopher ... but going with another OS will actually make everything worst.

      They will still be competing for the scraps at the bottom of the barrel but would have to share whatever miserable scraps they can get with the OS maker.
      wackoae
      • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

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      • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

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      • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

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    • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

      @global.philosopher
      Your post just shows you do not know how to read a financial report.
      kirovs@...
      • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

        @kirovs@... Motorola Mobility topped Wall Street expectations for the second quarter, but it could still be doing better. Meanwhile, the company???s earnings outlook fell short of expectations.<a href="http://www.vanarama.co.uk">Van leasing</a>
        digipham
      • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

        @kirovs@...
        Well, you are right when saying this. I totally agree with you.
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  • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

    Looks like those Android tablets are getting their butts kicked by the iPad. I'm shocked! LOL
    Tiggster79
    • But ... but ... but ...

      @LynxSteve ... the Xoom was the iPad killer. The fandroids were claiming that for months ....
      wackoae
      • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

        @wackoae Now the Android tablets are simply putting people to sleep. Watching the "impressive" Honeycomb features on Youtube reviews just weren't that impressive to me. I guess I'm comparing it to my iPad, but seriously it just seemed clunky and not very responsive. And this was version 3.1 which the reviewer was talking about how much improved it was over 3.0. If that is their improved version, was 3.0 even functional?
        Tiggster79
      • Sluggishness is the #1 &quot;feature&quot; of the Android OS

        @LynxSteve but fandroids will deny it to hell. To them, the very visual and annoying delay to user inputs is acceptable .... because it is from Google and they make "the best" pre-beta quality (ie: just good enough for Google) software in the world.
        wackoae
    • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

      @Tiggster79 That is a nice thing to know. Thanks
      markoseo
  • Message has been deleted.

    kangkangee
    • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

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  • Or...

    "However, Motorola did not disclose any specific numbers regarding how many of those units were actually sold to end users."

    Or how many XOOMs were returned.
    Bates_
    • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

      @Bates_ Get Real, nobody really posted this information contrary to popular opinion... It is all in how it is being reported and that's the part that is ignored.

      With Motorola Stating Shipped, they're acknowledging that they have no idea what is sitting in the channels and I would bet it isn't that many simply because you don't ship more if the majority hasn't sold.

      Anyway, the point remains... Some count items shipped as sold (even if they are not) and all have their returns regardless of brand.
      slickjim
  • RE: Motorola Mobility: 440K Xoom tablets shipped in Q2, but earnings outlook weak

    Congrats Rachel on posting the Whole Article and not just speculation and drivel.

    I believe Motorola Targeted 300k and stated 4.4 Million within a year. Now it is closer to 2 Million for 2011.
    slickjim
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