Motorola posts $80 million Q4 loss; ships 10.5 million mobile devices including 200,000 tablets - Tech Weblogs

Motorola Mobility Holdings, Inc. (NYSE: MMI) today reported net revenues of $3.4 billion in the fourth quarter of 2011, comparable to the fourth quarter of 2010. The GAAP net loss in the fourth quarter of 2011 was $80 million, or $0.27 per share, compared to net earnings of $80 million, or $0.27 per share, in the fourth quarter of 2010. On a non-GAAP basis, net earnings in the fourth quarter 2011 were $61 million, or $0.20 per share, compared to net earnings of $108 million, or $0.37 per share, in the fourth quarter of 2010.

For the full year, 2011 net revenues were $13.1 billion, up 14 percent compared to 2010. For the full year, the GAAP net loss was $0.84 per share compared to a loss of $0.29 per share in 2010. On a non-GAAP basis, net earnings were $0.33 per share compared to a loss of $0.28 per share in 2010.

The Company generated positive operating cash flow of $225 million and $357 million in the fourth quarter and full year, respectively. Total cash at the end of the quarter was $3.6 billion and includes cash, cash equivalents, and cash deposits.

Details on non-GAAP adjustments and the use of non-GAAP measures are included later in this press release and in the financial tables.

“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. Our Home business continues to be a leader in the industry’s transformation to all IP, with unique solutions that enable rich media experiences across any screen,” said Sanjay Jha, chairman and chief executive officer, Motorola Mobility. “We remain energized by the proposed merger with Google and continue to focus on creating innovative technologies.”

Mobile Devices net revenues in the fourth quarter, impacted by the increased competitive environment, were $2.5 billion, up 5 percent compared with the year-ago quarter. The GAAP operating loss was $70 million compared to operating earnings of $72 million in the year-ago quarter. The non-GAAP operating loss was $19 million compared to operating earnings of $56 million in the year-ago quarter. For the full year 2011, net revenues were $9.5 billion, an increase of 22 percent compared to 2010. The 2011 GAAP operating loss was$285 million compared to an operating loss of $76 million in 2010. The 2011 non-GAAP operating loss was $126 million compared to an operating loss of $198 million in 2010.

The Company shipped a total of 10.5 million and 42.4 million mobile devices in the fourth quarter and full year 2011, respectively. This included 5.3 million and 18.7 million smartphones and approximately 200 thousand and 1 million tablets in the fourth quarter and full year, respectively.

Home segment net revenues in the fourth quarter were $897 million, down 11 percent compared with the year-ago quarter. GAAP operating earnings were $57 million, compared to$54 million in the year-ago quarter. Non-GAAP operating earnings were $84 million compared to $90 million in the year-ago quarter. Fourth quarter set-top shipments were down 3 percent compared to the year-ago quarter. For the full year 2011, net revenues were $3.5 billion, compared to $3.6 billion in 2010. GAAP operating earnings increased to $226 millionfrom $152 million in 2010. The 2011 non-GAAP operating earnings increased to $332 million from $272 million in 2010. Full year set-top shipments were up 6 percent compared to 2010.

As previously announced on August 15, 2011, Motorola Mobility and Google Inc. (“Google”) (NASDAQ: GOOG) entered into a definitive agreement for Google to acquire Motorola Mobility for $40.00 per share in cash, or a total of approximately $12.5 billion. On November 17, 2011, Motorola Mobility stockholders voted overwhelmingly to approve the proposed merger with Google at the Company’s Special Meeting of Stockholders. The Company continues to work closely with Google to complete the proposed acquisition of Motorola Mobility as expeditiously as possible.

The Company notes that the transaction remains subject to various closing conditions. Antitrust clearances, or waiting period expirations, are required by the U.S. Department of Justice (DOJ), by the European Commission, and in Canada, China, Israel, Russia, Taiwan and Turkey. Requisite filings have been submitted to the appropriate regulatory body in each of these jurisdictions. Clearances have been received in Turkey and Russia. In Canada and the United States, the statutory waiting period for the transaction has expired although the parties have been informed that the reviewing agencies have not closed their respective investigations. In December 2011, the Chinese Ministry of Commerce proceeded to phase two of its investigation. In February, the European Commission is expected to announce whether it will close its investigation or proceed to a phase two investigation.

The Company currently expects the transaction to close in early 2012 once all conditions have been satisfied and reminds stockholders that it is possible that the failure to timely meet such conditions or other factors outside of the Company’s control could delay or prevent completion of the transaction altogether.

For more information on the proposed merger, please visit http://investors.motorola.com.

In light of the pending acquisition of the Company by Google, the Company does not conduct a financial analyst conference call or webcast following the release of its earnings information nor provide financial guidance. To access the fourth quarter results and other financial information, please visit http://investors.motorola.com.


	Fourth Quarter		Full Year
(In millions, except per share amounts)	2011	2010	2011	2010

Net revenues	$3,436	$3,425	$13,064	$11,460
Gross margin	854	915	3,317	2,965
Operating earnings (loss)	(78)	126	(142)	76
Earnings (loss) before income taxes	(78)	110	(148)	(4)
Net earnings (loss) attributable to Motorola Mobility Holdings, Inc.	($80)	$80	($249)	($86)

Basic earnings (loss) per common share *	($0.27)	$0.27	($0.84)	($0.29)
Diluted loss per common share*	($0.27)	N/A	($0.84)	N/A

Weighted average common shares outstanding
Basic	300.2	294.3	297.1	294.3
Diluted	300.2	N/A	297.1	N/A


	Fourth Quarter
Per Share Impact	2011	2010
GAAP Earnings (Loss) per Common Share *	($0.27)	$0.27

Merger-related costs**	0.22	——
Reorganization of business charges	0.09	0.06
Stock-based compensation expense	0.12	0.14
Intangible assets amortization expense	0.04	0.05
Joint venture wind-down costs	——	0.03
IP settlement	——	(0.19)
Total Non-GAAP Adjustments ***	0.47	0.10

Non-GAAP Earnings per Common Share *	$0.20	$0.37


	Full Year
Per Share Impact	2011	2010
GAAP Loss per Common Share *	($0.84)	($0.29)

Merger-related costs**	0.28	——
Reorganization of business charges	0.09	0.20
Stock-based compensation expense	0.52	0.55
Intangible assets amortization expense	0.20	0.19
Legal claim provision	0.07	——
Joint venture wind-down costs	——	0.03
Legal settlement	——	(0.77)
IP settlement	——	(0.19)
Total Non-GAAP Adjustments ***	1.16	0.01

Non-GAAP Earnings (Loss) per Common Share *	$0.33	($0.28)