Motorola, the US communications equipment and semiconductor group, on Monday told analysts that its revenues should reach about $47bn in 2001, with earnings per share jumping to around $1.43.
Motorola ended Tuesday’s trading day up more than 5 percent, or $1-3/4 at $35.
Bob Growney, chief operating officer, said that the group believed Wall Street’s consensus forecasts were achievable. He also reiterated his forecast – made at the time of the second quarter earnings release – of sales of around $39.5bn and earnings per share of $1.05 in 2000.
Mr Growney also said that Motorola, unhappy with its current share rating, was looking at ways of unlocking value tied up in a number of public company investments. The group has already parcelled its stakes in about 20 overseas wireless phones service providers into a newly formed company called Propel. Last month it filed initial public offering registration documents for Propel, although no date had yet been announced for a sell-off.
In a series of divisional presentations, Motorola admitted that while its semiconductor products division has been posting much improved results, it was still not matching market trends or margins reached by competitors.
However, Motorola said that efforts to enhance collaboration across the division and address costs should bring sequential improvement in the third and fourth quarters of 2000 and through 2001. “We are on target to achieve double digit margins in the fourth quarter,” said Fred Tucker, president of the semiconductor products division.
By contrast, the company was extremely upbeat about prospects in the burgeoning automotive telematics sector, pointing to forecasts which suggest that hardware equipment sales could be as high as $25bn by 2006. Reuters