Motorola Exceeds Estimates by a Penny, But. . .
Weak margins in the firm's mobile-phone unit are a concern.
Motorola (MOT) elaborated on its first-quarter earnings Tuesday morning, and weak margins in the firm's mobile-phone segment are a legitimate concern.
After the first-quarter earnings release Monday evening, Motorola's conference call Tuesday morning shed some light on why the company’s shares opened the day down almost 20%. Stronger-than-expected sales growth across all of Motorola's major segments helped the company eke out first-quarter earnings a penny ahead of consensus analyst estimates. But Motorola’s results weren’t all rosy: Operating margins in the company’s cell-phone unit were paltry, at less than 2%. The company blamed the lackluster margins on component shortages and an untimely product transition.
Jeremy Lopez does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.