Motorola Vowing to Turn Profit This Year
Mawhorr, S. A., Daily Herald (Arlington Heights, IL)
Byline: S. A. Mawhorr Daily Herald Business Writer
Motorola Inc. said Wednesday it expects to return to profitability in the third quarter and turn a profit of about 4 cents per share for the year despite slumping sales.
"That's knock-on-wood, cross-your-fingers kind of thinking," said Joseph Correnti, an analyst with Wayne Hummer Investments.
But still, Correnti is willing to give the economy and the company the benefit of the doubt and is expecting Motorola to report a 3-cent-per-share profit for the year.
The market also gave the company the benefit of the doubt. The stock jumped almost 9 percent to close Wednesday at $16.33.
Motorola, the world's second largest cell phone maker, expects sales for all of 2002 to be down from 5 percent to 10 percent.
But company officials are betting that an improving economy, stronger performance in its cell phone and semiconductor sectors, and cost-cutting measures that improve operating margins should be enough for the company to report a profit of 4 cents per share for 2002, excluding special charges.
In an effort to slash costs, the company has been slashing it's work force by a third from a peak of about 150,000 in mid-2000. Chief Operating Officer Ed Breen said the company had 107,000 employees at the end of March and is on track to reduce that number to 100,000 by the end of the year. …