-- Set a new quarterly record in video, shipping nearly 2.5 million
digital entertainment devices.
-- Subsequent to the close of the quarter, Motorola shipped the
50 millionth digital entertainment device, underscoring the company's
heritage of delivering innovations for the digital cable connected
home.
-- Expanded its next-generation digital video portfolio, completing two
acquisitions during the quarter: Broadbus, Motorola's new On Demand
Solutions business, and Vertasent, a developer of software that manages
the technology elements for switched digital video networks. With these
two acquisitions, Motorola has enhanced its end-to-end, switched
digital video solution and software portfolio, delivering advanced
video services and improved bandwidth management to pay-TV service
operators.
-- During the quarter, Motorola On Demand Solutions (Broadbus) set a
quarterly record, shipping 57,000 video streams across 17 systems.
Fourth Quarter 2006 Outlook
The company's outlook for the fourth quarter of 2006 is for sales of between $11.8 billion and $12.1 billion, an increase of 18 to 21 percent versus the prior-year quarter.
Conference Call and Web-cast
Motorola's quarterly earnings conference call is scheduled to begin at 4:00 p.m. Central Time (USA) on Tuesday, October 17, 2006. Motorola plans a live web-cast of the conference call over the Internet, featuring both audio and slides. Investors can view the slides and join the web-cast at http://www.motorola.com/investor .
Consolidated GAAP Results
A comparison of results from operations is as follows:
Third Quarter
(In millions, except per share amounts) 2006 2005
Net sales $10,603 $9,048
Gross margin 3,374 2,929
Operating earnings 968 1,080
Earnings from continuing operations 727 1,738
Net earnings 968 1,751
Diluted earnings per common share:
Continuing operations $0.29 $0.68
Discontinued operations 0.10 0.01
$0.39 $0.69
Weighted average diluted common shares
outstanding 2,476.8 2,547.0
Business Risks
This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. Any statements that are not historical facts are forward-looking statements and are based on Motorola's current expectations, which are subject to numerous risks and involve numerous uncertainties. Such forward-looking statements include, but are not limited to, Motorola's outlook for sales in the fourth quarter of 2006 and expected timing of product introductions. Motorola cautions the reader that the factors below, as well as those on pages 19 through 27 in Item 1A of Motorola's 2005 Annual Report on Form 10-K and in its other SEC filings, could cause Motorola's actual results to differ materially from those predicted in the forward-looking statements. Motorola undertakes no obligation to publicly update any forward-looking statement or risk factor, whether as a result of new information, future events, or otherwise. Factors that may impact forward-looking statements include, but are not limited to: (1) the company's ability to continue to increase profitability and market share in its wireless handset business; (2) the level of demand for the company's products, including products related to new technologies; (3) the company's ability to introduce new products and technologies in a timely manner; (4) the company's ability to continue generating meaningful savings from supply-chain improvements, manufacturing consolidation and other cost- reduction initiatives; (5) the uncertainty of current economic and political conditions, as well as the economic outlook for the telecommunications and broadband industries; (6) the company's ability to purchase sufficient materials, parts and components to meet customer demand; (7) unexpected negative consequences from the realignment of the company's Networks and Enterprise business; (8) risks related to dependence on certain key suppliers; (9) the impact on the company's performance and financial results from strategic acquisitions or divestitures, including those that may occur in the future; (10) risks related to the company's high volume of manufacturing and sales in Asia; (11) the creditworthiness of the company's customers, particularly purchasers of large infrastructure systems; (12) variability in income generated from licensing the company's intellectual property; (13) unexpected liabilities or expenses, including unfavorable outcomes to any pending or future litigation, including without limitation any relating to the Iridium project; (14) the timing and levels at which design wins become actual orders and sales; (15) the impact of foreign currency fluctuations; (16) the impact on the company from continuing hostilities in Iraq and conflict in other countries; (17) the impact on the company from ongoing consolidation in the telecommunications and broadband industries; (18) the impact of changes in governmental policies, laws or regulations; (19) the outcome of currently ongoing and future tax matters; and (20) unforeseen negative consequences from the company's outsourcing of various activities, including certain manufacturing, information technology and administrative functions.
About Motorola
Motorola is known around the world for innovation and leadership in wireless and broadband communications. Inspired by our vision of Seamless Mobility, the people of Motorola are committed to helping you get and stay connected simply and seamlessly to the people, information, and entertainment that you want and need. We do this by designing and delivering "must have" products, "must do" experiences and powerful networks -- along with a full complement of support services. A Fortune 100 company with global presence and impact, Motorola had sales of US $35.3 billion in 2005. For more information about our company, our people and our innovations, please visit
http://www.motorola.com .
