(Associated Press via NewsEdge) Motorola replaced its chief financial officer in a shake-up of top management as it slashed its first-quarter forecast, blaming weaker-than-expected revenue from its mobile phone unit.
Still reeling from sales and profit problems that emerged in the fourth quarter, the company said it now expects to report a first-quarter loss because of what chairman and CEO Ed Zander called an 'unacceptable' performance by its mobile device business.
Thomas Meredith, 56, was named acting chief financial officer, effective April 1.
He replaces David Devonshire, 61, who will retire from the position. Zander also named Greg Brown, president of the company's networks and enterprise business, to the vacant posts of president and COO.
The surprise announcement after markets closed reflected even deeper turmoil within the Schaumburg-based company just a month after the head of its embattled handset business resigned.
The world's No. 2 mobile phone maker behind Nokia said it now expects sales for the January-through-March quarter of $9.2 billion to $9.3 billion, down more than $1 billion from its January forecast of $10.4 billion to $10.6 billion.
The company said it expects sales, profitability and operating cash flow for the full year to be 'substantially' below its prior guidance.
'Performance in our mobile devices business continues to be unacceptable, and we are committed to restoring its profitability,' Zander said. 'After a further review following the leadership change in our mobile devices business, we now recognize that returning the business to acceptable performance will take more time and greater effort.'
He said the company, no longer willing to boost market share at the expense of profit margin, decided not to match competitors' price cuts on some inexpensive models last month, and that hurt sales significantly.
© 2007 The Associated Press
© 2007 Dialog, a Thomson business. All rights reserved