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Motorola under Google: record loss due to accounting noise, “expect changes”

Posted: , by Victor H.

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Motorola under Google: record loss due to accounting noise, “expect changes”
Google yesterday announced its results for the second quarter of the year, and it was a relatively steady quarter with the search giant growing revenue. What’s much more interesting is that this was the first quarter (not even a full one) with Motorola now officially part of the Google empire. On May 22nd, Google closed the $12.5 billion deal it announced back in August last year.

So what are the first results? At first sight, the Motorola acquisition doesn’t seem to work out that well - the company posted a record loss of $233 million for the quarter, comparable to the $285 million loss for the whole fiscal 2011.

Motorola lost $192 million in its mobile department and $41 million for its home device business.

Still, one has to take into account that clearly Motorola has just started integrating into the Google system of things. Google’s chief financial officer Patrick Pichette called for more patience as Google has been managing the phone company for only a few weeks, and said part of the loss was due to “accounting noise.”

“Clearly, everyone should expect changes at Motorola,” Pichette said. “We have to let them do their work.”

At the same time, Google is clearly seeing its future in mobile. “Mobile is where search was in 1999,” said Google’s chief business officer Nikesh Arora. “Mobile is going to be as core as desktop search was,” he said. But how will Motorola fit in that picture is not yet clear. What do you think, what would Motorola’s role be in Google’s business?

source: Google

21 Comments
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posted on 20 Jul 2012, 03:22 3

1. MeoCao (unregistered)


Google just does not get enough return from their investment in Android and Motorola is 1 way to do it. We can see from Nexus line that Google knows a thing or 2 about gadget design.

posted on 20 Jul 2012, 03:35 2

2. mas11 (Posts: 1030; Member since: 30 Mar 2012)


I know Google is trying not to play favorites, but I'm sure a Motorola Nexus device would be a huge hit.

posted on 20 Jul 2012, 10:07 2

10. Tux4g63 (Posts: 118; Member since: 21 Oct 2011)


This would be a very predictable top seller. My humble opinion is that Google will only pull this card as a last resort if they need to have as close to a guaranteed seller as need be. As soon as the card is played, they will have to deal with the favoritism mongers again and somehow leveraging the loyal fan base of Motorola AND Android in a product that has to raise the bar. Period.

Until then, they would be practical to exhaust all other venues for revenue and expansion first.

posted on 20 Jul 2012, 12:17 1

13. darac (Posts: 2156; Member since: 17 Oct 2011)


Are you aware that this year will bring multiple nexus phones from different brands?:)

posted on 20 Jul 2012, 13:44 1

14. mas11 (Posts: 1030; Member since: 30 Mar 2012)


That's just a rumor.

posted on 21 Jul 2012, 04:16

20. remixfa (Posts: 13930; Member since: 19 Dec 2008)


thats just a rumor I think we all hope is TRUE.
More nexus means nexus with better capabilities. Maybe we will finally see an end to the nexus with purposefully gimped features so it doesnt cannibalize sales of other smartphones (cough cough 5mpx camera, non removable memory, older chipsets)

posted on 20 Jul 2012, 03:54 2

3. jael206 (Posts: 128; Member since: 18 Jul 2012)


when will the Motorola Nexus come out? is it in the manufacturing line already? coz its about time i replace my Motorola MicroTac already

posted on 20 Jul 2012, 03:59 5

4. darac (Posts: 2156; Member since: 17 Oct 2011)


Moto has all the tech resources and
know-how, and - most importantly, all the financial support they can wish for - to produce spectacular phones.
Now with closest to pure google software
and promising update prospects, their previous weaknesses will turn into great strength.

The first true product of GoogleMoto will be their Nexus phone.
Just think RAZR MAXX with A15 chip, 4.6inch HD screen, 12-13mp camera
and JB!
A phone of the year!

posted on 20 Jul 2012, 21:59

17. Jimstar (Posts: 259; Member since: 24 Oct 2011)


it's like you made that post just to hear yourself talk...
We get it, the hypothetical Motorola Nexus should be amazing. We've known that since before the acquisition even happened, give it a rest.

posted on 21 Jul 2012, 04:19

21. remixfa (Posts: 13930; Member since: 19 Dec 2008)


they dont have ANY unlimited financial support darac.
They are run as 2 separate companies with 2 separate bank accounts. Just because google bought them doesn't mean google is giving them unlimited bank account privileges. Samsung mobility and Samsung construction dont share the same bank accounts back n forth.. neither do Vodaphone and VZW/VZlandline. They are reported under 1 company umbrella but they operate separately.

posted on 20 Jul 2012, 04:00 1

5. cGmC11 (Posts: 110; Member since: 02 Apr 2012)


Yes everything may change this November with the unveiling of the Motorola RAZR Nexus!

posted on 20 Jul 2012, 04:48 2

6. nicholassss (Posts: 351; Member since: 10 May 2012)


The razor is cool and all but id rather the motorola nexus be its own deal. I mean, sure, i'll still buy it with the razor name attached, but for some reason i wouldn't be as excited, haha.

posted on 20 Jul 2012, 06:15 1

7. QWIKSTRIKE (Posts: 880; Member since: 09 Mar 2010)


Moto only launches on Verizon....that has to keep sales low selling only on one carrier a great phone. Samsung finally broke this bull crap practice. Carriers also f up a phones potential sales.

Had Moto launched on Sprint a Razor I would have bought one!

posted on 20 Jul 2012, 15:54

16. Sprintfan (Posts: 68; Member since: 18 Nov 2011)


Moto is on sprint to. They do most of the push to talk phones and a few androids. No where as near as cool as VZW's. After the moto Q i will never trust Moto again.

posted on 20 Jul 2012, 06:26 1

8. ilani (Posts: 53; Member since: 23 Dec 2011)


enough with the Razr, the Razr is Crap! (personally own one) Motorola has everything it needs to be as big as samsung, only the execs were idiots! I hope the new ones from Google, are a bit smarter! What happened to that pact we read about, that companies would release fewer phones per year. So many Lines, Razr,Atrix,defy,motosmart,motolux,motokey. holy Geez! and worst part is you buy one, and a few months later they add a PLUS or MAXX to the end and release another similar phone, alienate the customers who buy the first version.
i wouldn't be as bold as to tell moto what strategies to use in the future,(there are a lot of people, more qualified than I) As for the Current one? Moto's strategy sucks! You're not Samsung, stop releasing soo many phones! and, you're definitely not Apple!, Stop it with the MAXXs and +'s. P.S. I Love Motorola, from StarTac, to Og Razr(flipphone), to Milestone! Your Previous phones, are why people keep coming back! Stop Alienating them!

posted on 20 Jul 2012, 09:01 1

9. troutsy (Posts: 274; Member since: 17 Feb 2012)


Yeah... You sound like more of an iPhone person. You should just get a 4s and ride off into the sunset.

Android, you, and us (the PA community) just aren't meant to be together.

posted on 20 Jul 2012, 22:04 1

18. Jimstar (Posts: 259; Member since: 24 Oct 2011)


YOUR Razr is crap maybe, mine is an amazing phone.
And your analysis of Moto's strategy, sounds pretty half baked honestly. Moto released the least phones of any large android OEM all last year and this year so far. They're not even approaching stretching themselves thin...

posted on 20 Jul 2012, 23:23

19. BattleBrat (Posts: 1093; Member since: 26 Oct 2011)


Hmmm, someone is angry the RAZR MAXX came out. I bought the RAZR (not the MAXX) and I'm very happy with it, even after the MAXX came out. battery life has never been a problem with my RAZR...

posted on 20 Jul 2012, 11:29 1

11. keitham1977 (Posts: 3; Member since: 13 Feb 2012)


Seems to me Google shows Samsung favoritism... I think they acquired Motorola to keep down the competition I mean look at the financials for this year so far... I like Motorola as a company and I like their cell phones I'd hate to see them go under. Samsung produces cheap, light, and not well built phones in my opinion... sure the hardware is top notch but the build quality sucks! Motorola's phones feel solid in your hand. I am disappointed in the Google/Motorola acquisition...I don't think they mean well!

posted on 20 Jul 2012, 11:59 3

12. MorePhonesThanNeeded (Posts: 623; Member since: 23 Oct 2011)


Eh this is what happens when you merge a business or buy one, you expect losses, Google assumes all Motorola's debt when the bought the company. Now give them a couple of quarters to start turning things around, which shouldn't be too far off considering that MM had already started to turn it's fortunes around before the big buy.

Google plans to release 5 nexus phones this year. Motorola will definitely be among them and possibly the best considering that Motorola has some pretty sweet designs and that tech know how. Now as long as they get a quality processor and LTE under the hood with a razor sharp 4.5"+ screen I have no problems seeing the Motorola nexus phone easily land up there with Sammy's best.

posted on 20 Jul 2012, 14:04 1

15. kanagadeepan (Posts: 682; Member since: 24 Jan 2012)


I love my RazrMAXX's battery life & build quality, but hate its encrypted bootloader... A Moto-Nexus device with MAXX battery + HD screen will be a definite SUPER HIT, imho...

Since Nexus devices always comes with easily unlockable (via a single ADB command) non-encrypted bootloader, Moto-Nexus will have NO -ve points, imho....

With Moto build quality being top-notch and with out-of-the-earth battery life, Moto-Nexus can give great toughness to Sammy-Nexus, imho...

Come on Google, Moto-Nexus being one among the five NEXII devices will NEVER be considered as partiality... My next phone is definitely a NEXUS device... Bring it on GOOGLE + Motorola_Mobility....

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