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Just read this article from the Associated Press. It's no wonder SCUSA said to use the Nokia phone - it's the most readily available. And since Ericsson is made in Sweden and Nokia is made in Finland, that makes for some annoyed Swedes.
The third paragraph of the article is the most significant!
From http://my.aol.com/news/news_story.psp?type=3&cat=0500&id=0101111100410679
Motorola Warns on Cell-Phone Profits
The Associated Press
Jan 11 2001 11:00AM
CHICAGO (AP) - Motorola Inc. cautioned on Thursday that cell-phone
profit woes and a slowing semiconductor market will continue to dog its
performance for at least the first half of 2001.
In a conference call with investors, executives blamed the cooling
economy for part of Motorola's problems, which worsened in the fourth
quarter with a steep falloff in orders for wireless devices and
semiconductors.
But analysts said the Schaumburg, Ill.-based tech giant's struggles in
the cellular phone business it once dominated are largely its own
doing. Worldwide sales have soared and Finland's Nokia, which took
over the No. 1 spot from Motorola in 1999, has increased its market
share to more than double that of Motorola.
Motorola shares rose 75 cents to $21.94 Thursday morning on the New
York Stock Exchange.
The stock increase came despite Motorola's warning that the cell-phone
business will see ``no significant improvement'' for the next three to
six months and that world semiconductor sales will grow less speedily
than previously forecast - 10 percent to 15 percent in 2001.
Analyst Todd Bernier of Chicago-based Morningstar called Motorola's
showing and near-term outlook ``miserable'' and said its sales
prospects ``look weak right across the board.''
``In the semiconductor industry, they're suffering from the same
overcapacity others are,'' he said Thursday. ``But in the cell-phone
industry, it's their own fault. Nokia doesn't see the slowdown that they
do.''
Brian Modoff of Deutsche Bank Alex. Brown said the company appears
to be positioning itself as a second-half recovery story, but added
there's no sign yet of light at the end of the tunnel.
``With (cell-phone) handsets, they're clearly targeting the second half
with new phones,'' he said. ``But the biggest issue in handsets is
getting them out on time. That's where they've been struggling.''
Motorola pledged more cost-cutting measures aimed at boosting its
sliding earnings as it reported a 41 percent drop in fourth-quarter
profits after markets closed Wednesday.
While overall revenues climbed 11 percent to $10.06 billion, sales of
cell phones and other wireless devices rose just 1 percent to $3.5
billion and were down ``very significantly'' in Europe, the company said.
Wireless orders fell 20 percent to $2.9 billion.
Wednesday's report met Wall Street's lowered expectations, confirming
the downward trend outlined by the company in early December when
its second warning in two months sent the stock tumbling to a two-year
low.
Excluding special items, earnings for the last three months of 2000
were $335 million, or 15 cents a share, down from $564 million, or 25
cents a share, a year earlier. That was in line with the estimate of a
consensus of securities analysts surveyed by First Call/Thomson
Financial.
Robert Growney, Motorola's president and chief operating officer,
blamed the decline in profits on increases in manufacturing costs and
operating expenses.
``We have taken steps to reduce the cost structure in our
manufacturing activities and to tightly control operating expenses,'' he
said. ``Further steps will be taken in 2001 to return the corporation to
generating growth in its earnings.''
Motorola took one-time charges during the quarter related to the
discontinuation of older mobile phones and manufacturing operation
cutbacks. With the inclusion of those special items, earnings were only
6 cents a share, or $135 million.
Semiconductor sales increased 7 percent to $1.9 billion, but orders
slipped by 19 percent to $1.6 billion.
For the full year, Motorola's earnings rose to $1.90 billion, or 84 cents
a share, up 37 percent from $1.38 billion, or 63 cents a share, in 1999.
Sales for 2000 climbed 17 percent to $37.56 billion from $32.02 billion
the previous year.
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