Motorola Profits, Stock Price Take a Dive

Lackluster sales from the company's handset division are partially to blame for a disappointing fourth quarter.

Despite a strong market for cell phones, American communications giant Motorola has been hurting for sales lately, the company’s quarterly figures show. In a report released Wednesday, Motorola revealed that its fourth-quarter profits fell 84 percent.

Many analysts blame stiff competition in the handset market, which makes up the bulk of Motorola’s business. A report from Bloomberg specifically blamed devices like the Apple iPhone and Samsung Sync, which have been hot sellers in contrast to Motorola’s own new flagship, the Razr2.  The company’s handset unit ended up producing an operating loss of $388 million for the quarter, when just a year ago in the same quarter it posted a profit of $341 million.

In response to the company’s predicted loss in market share into 2008, the company’s stock price fell on Wednesday morning in early trading to $10.30, a drop of $2.02 and the lowest the company’s stock has fallen since 2003, according to Bloomberg.