Current Report

 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 30, 2009
Motorola, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
     
1-7221   36-1115800
(Commission File Number)   (I.R.S. Employer Identification No.)
     
1303 East Algonquin Road, Schaumburg, Illinois   60196
(Address of Principal Executive Offices)   (Zipcode)
(847) 576-5000
(Registrant’s Telephone Number, Including Area Code)
Not applicable
(Former Name or Former Address, if Changed Since Last Report)
     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

 

 

Item 2.02.   Results of Operations and Financial Condition
      The information in this Form 8-K that is furnished under “Item 2.02. Results of Operations and Financial Condition” and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
     On July 30, 2009, Motorola, Inc. issued a press release announcing financial results for the quarter ended July 4, 2009. A copy of this press release is attached hereto as Exhibit 99.1.
Item 9.01.   Financial Statements and Exhibits
(d) Exhibits. The following is filed as an Exhibit to this Report.
         
Exhibit No.   Document
       
 
  99.1    
Press Release by Motorola, Inc. dated July 30, 2009 announcing financial results for the quarter ended July 4, 2009.

 

 

SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
         
  MOTOROLA, INC.
  		 
Date: July 30, 2009  By:   /s/ Edward J. Fitzpatrick    
    Edward J. Fitzpatrick   
    Senior Vice President,
Corporate Controller and
Acting Chief Financial Officer  		 
 

 

 

EXHIBIT INDEX
         
Exhibit No.   Document
       
 
  99.1    
Press Release by Motorola, Inc. dated July 30, 2009 announcing financial results for the quarter ended July 4, 2009.

 

Exhibit 99.1
Motorola Reports Second-Quarter Financial Results
  •   Second-quarter sales of $5.5 billion
 
  •   Second-quarter GAAP earnings from continuing operations of $0.01 per share, including net income of $0.02 per share from highlighted items
 
  •   Total cash of $6.5 billion, a sequential increase of $360 million
 
  •   Increased cost reduction plan by $100 million; now expect total cost savings of $1.8 billion for 2009
 
  •   Home and Networks Mobility sales of $2.0 billion; operating earnings of $153 million
 
  •   Mobile Devices sales of $1.8 billion; shipped 14.8 million handsets; operating loss of $253 million, improved by 50 percent sequentially
 
  •   Enterprise Mobility Solutions sales of $1.7 billion; operating earnings of $227 million
SCHAUMBURG, Ill. — July 30, 2009 — Motorola, Inc. (NYSE: MOT) today reported sales of $5.5 billion in the second quarter of 2009. The GAAP earnings from continuing operations in the second quarter of 2009 were $26 million, or $0.01 per share. The GAAP earnings from continuing operations includes net income of $0.02 per share from highlighted items, which are outlined in the table at the end of the press release.
Total cash* at the end of the second quarter was $6.5 billion, an increase of $360 million compared to the end of the first quarter. The Company generated $150 million of positive operating cash flow during the quarter and expects to continue to generate positive cash flow in the second half of the year.
Greg Brown, co-CEO of Motorola and CEO of Broadband Mobility Solutions, said, “In Broadband Mobility Solutions, we continued to lead in our key markets and delivered solid results in a very challenging economic environment. We further reduced our cost structure, improved our operating margins and decreased inventory on a sequential basis. We also continued to focus our R&D efforts on innovation in areas such as next-generation public safety, enterprise mobile computing, enhanced broadband video and 4G wireless.”
Sanjay Jha, co-CEO of Motorola and CEO of Mobile Devices, added, “We have agreements in place with carriers and remain on track to bring our new smartphone devices to market for the holiday selling season. We are also excited about our 2010 portfolio and are pleased with the customer feedback. In Mobile Devices, we improved the operating loss, reflecting a lower cost structure, and substantially reduced cash consumption as compared to the first quarter.”

 

 

Operating Results
Mobile Devices segment sales were $1.8 billion, down 45 percent compared to the year-ago quarter. The GAAP operating loss was $253 million, compared to an operating loss of $346 million in the year-ago quarter. The segment reduced its operating loss by 50 percent sequentially from $509 million in the first quarter of 2009.
Mobile Devices highlights:
  •   Shipped 14.8 million handsets; estimated global handset market share of 5.5 percent
 
  •   Continued progress on differentiated smartphone devices targeted to launch in the fourth quarter of 2009
 
  •   Launched the CDMA Rival™ A455, a side-slider with one-touch messaging access and QWERTY keyboard; and the 3G Karma™ QA1, a slide-out QWERTY with one-click access to Facebook and MySpace
 
  •   Launched the iDEN Clutch™ i465, Motorola’s first device that combines the power of push-to-talk and the convenience of a QWERTY keyboard
Home and Networks Mobility segment sales were $2.0 billion, down 27 percent compared to the year-ago quarter. GAAP operating earnings were $153 million, compared to operating earnings of $245 million in the year-ago quarter.
Home and Networks Mobility highlights:
  •   Shipped 3.7 million digital entertainment devices
 
  •   Launched the world’s first retail DOCSIS ® 3.0 cable modem
 
  •   Surpassed cumulative WiMAX CPE shipments of 650,000 units
 
  •   Announced an all-fiber enterprise passive optical LAN solution designed to reduce network cost and complexity
Enterprise Mobility Solutions segment sales were $1.7 billion, down 17 percent compared to the year-ago quarter. GAAP operating earnings were $227 million, compared to operating earnings of $377 million in the year-ago quarter.
Enterprise Mobility Solutions highlights:
  •   Shipped APX™ 7000, a new portable radio platform for the public safety market, which provides multi-band functionality for system interoperability and unmatched volume and audio clarity for extreme environments
 
  •   Released Capacity Plus software for MOTOTRBO™, a digital trunked radio solution for enterprise users, greatly increasing single-site capacity for critical voice and data communication
 
  •   Released the world’s first TETRA base station supporting TETRA Enhanced Data Services with IP-over-Ethernet connectivity

 

 

•   Secured public safety awards from the State of Missouri, German Ministry of Interior (Berlin), City of Hamilton in Ontario Canada, and West Australian Police
Third-Quarter 2009 Outlook
The Company’s outlook for third-quarter earnings from continuing operations is $(0.01) to $0.01 per share. This outlook excludes charges associated with the Company’s operating expense reduction initiatives, as well as any other items of the variety typically highlighted by the Company in its quarterly earnings releases.
Consolidated GAAP Results
A comparison of results from operations is as follows:
                 
    Second Quarter
(In millions, except per share amounts)   2009   2008
Net sales
  $ 5,497     $ 8,082  
Gross margin
    1,710       2,325  
Operating earnings
    10       5  
Earnings from continuing operations**
    26       4  
Net earnings**
    26       4  
Diluted earnings per common share:
               
Continuing operations
  $ 0.01     $ 0.00  
 
               
Weighted average diluted common shares outstanding
    2,306.4       2,269.5  
Highlighted Items
The table of highlighted items for the second quarter of 2009 is as follows:
         
    EPS Impact
    Exp/(Inc)
Gain on Sigma Fund investments
  $ (0.02 )
Legal settlement
    (0.02 )
Adjustment to software/silicon platform
       
consolidation reserves
    (0.01 )
Reorganization of business and similar charges
    0.02  
Facility impairment
    0.02  
Tax-related benefit
    (0.01 )
 
       
 
  $ (0.02 )

 

 

Conference Call and Webcast
Motorola will host its quarterly conference call beginning at 8:00 a.m. Eastern Time (USA) on Thursday, July 30, 2009. The conference call will be webcast live with audio and slides at www.motorola.com/investor .
Business Risks
This press release contains “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements about: cost savings and financial impact from cost-reduction actions, levels of cash generation and consumption in 2009, the timing and impact of the launch of new products and Motorola’s financial outlook for the third quarter of 2009. Motorola cautions the reader that the risk factors below, as well as those on pages 18 through 30 in Item 1A of Motorola’s 2008 Annual Report on Form 10-K and in its other SEC filings, could cause Motorola’s actual results to differ materially from those estimated or predicted in the forward-looking statements. Factors that may impact forward-looking statements include, but are not limited to: (1) the Company’s ability to improve financial performance and increase market share in its Mobile Devices business; (2) the level of demand for the Company’s products, particularly in light of global economic conditions which may lead consumers, businesses and governments to defer purchases in response to tighter credit and negative financial news; (3) the Company’s ability to introduce new products and technologies in a timely manner; (4) the possible negative effects on the Company’s business operations, financial performance or assets as a result of its plan to create two independent, publicly traded companies; (5) unexpected negative consequences from the Company’s ongoing restructuring and cost reduction activities, including as a result of significant restructuring at the Mobile Devices business; (6) negative impact on the Company’s business from the global financial crisis and tightening in the credit markets, which may include: (i) the inability of customers to obtain financing for purchases of the Company’s products; (ii) the viability of the Company’s suppliers that may no longer have access to necessary financing; (iii) reduced value of investments held by the Company’s pension plan and other defined benefit plans; (iv) fair and/or actual value of the Company’s debt and equity investments differing significantly from the fair values currently assigned to them; (v) counterparty failures negatively impacting the Company’s financial position; (vi) difficulties or increased costs for the Company in obtaining financing; and (vii) the inability of the Company to sell accounts receivable and long-term receivables in volumes and on terms comparable to historical practices; (7) the economic outlook for the telecommunications and broadband industries; (8) the Company’s ability to purchase sufficient materials, parts and components to meet customer demand, particularly in light of global economic conditions; (9) risks related to dependence on certain key suppliers; (10) the impact on the Company’s performance and financial results from strategic acquisitions or divestitures, including those that may occur in the future; (11) risks related to the Company’s high volume of manufacturing and sales in Asia; (12) the creditworthiness of the Company’s customers and distributors, particularly purchasers of large infrastructure systems; (13) variability in income received from licensing the Company’s intellectual property to others, as well as expenses incurred when the Company

 

 

licenses intellectual property from others; (14) unexpected liabilities or expenses, including unfavorable outcomes to any pending or future litigation or regulatory or similar proceedings; (15) the impact of foreign currency fluctuations, including the negative impact of the strengthening U.S. do llar on the Company when competing for business in foreign markets; (16) the impact on the Company from continuing hostilities in countries where the Company does business; (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) negative consequences from the Company’s outsourcing of various activities, including certain manufacturing, information technology and administrative functions. 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.
Definitions
*“Total cash” equals Cash and cash equivalents plus Sigma fund (current and non-current) plus Short-term investments.
**Amounts attributable to Motorola, Inc. common shareholders
About Motorola
Motorola is known around the world for innovation in communications and is focused on advancing the way the world connects. From broadband communications infrastructure, enterprise mobility and public safety solutions to high-definition video and mobile devices, Motorola is leading the next wave of innovations that enable people, enterprises and governments to be more connected and more mobile. Motorola (NYSE: MOT) had sales of $30.1 billion in 2008. For more information, please visit www.motorola.com.
# # #
Media contact:
Jennifer Erickson
Motorola, Inc.
+1 847-435-5320
Jennifer.erickson@motorola.com
Investor contact:
Dean Lindroth
Motorola, Inc.
+1 847-576-6899
dean.lindroth@motorola.com

 

 

Motorola, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In millions, except per share amounts)
                         
    Three Months Ended  
    July 4, 2009     April 4, 2009     June 28, 2008  
Net sales
  $ 5,497     $ 5,371     $ 8,082  
Costs of sales
    3,787       3,875       5,757  
 
                 
Gross margin
    1,710       1,496       2,325  
 
                 
 
                       
Selling, general and administrative expenses
    822       869       1,115  
Research and development expenditures
    775       847       1,048  
Separation-related transaction costs
    —       —       20  
Other charges
    33       158       56  
Intangibles amortization and IPR&D
    70       71       81  
 
                 
Operating earnings (loss)
    10       (449 )     5  
 
                 
 
                       
Other income (expense):
                       
Interest expense, net
    (30 )     (35 )     (10 )
Gain (loss) on sales of investments and businesses, net
    30       (20 )     39  
Other
    23       70       (92 )
 
                 
Total other income (expense)
    23       15       (63 )
 
                 
 
                       
Earnings (loss) from continuing operations before income taxes
    33       (434 )     (58 )
 
                       
Income tax benefit
    (2 )     (146 )     (55 )
 
                 
Earnings (loss) from continuing operations
    35       (288 )     (3 )
 
                       
Earnings from discontinued operations, net of tax
    —       60       —  
 
                 
Net earnings (loss)
    35       (228 )     (3 )
 
                       
Less: Earnings (loss) attributable to the noncontrolling interest
    9       3       (7 )
 
                 
Net earnings (loss) attributable to Motorola, Inc.
  $ 26     $ (231 )   $ 4  
 
                 
 
                       
Amounts attributable to Motorola, Inc. common shareholders
                       
Earnings (loss) from continuing operations, net of tax
  $ 26     $ (291 )   $ 4  
Earnings from discontinued operations, net of tax
    —       60       —  
 
                 
Net earnings (loss)
  $ 26     $ (231 )   $ 4  
 
                 
 
                       
Earnings (loss) per common share
                       
Basic:
                       
Continuing operations
  $ 0.01     $ (0.13 )   $ 0.00  
Discontinued operations
    —       0.03       —  
 
                 
 
  $ 0.01     $ (0.10 )   $ 0.00  
 
                 
 
                       
Diluted:
                       
Continuing operations
  $ 0.01     $ (0.13 )   $ 0.00  
Discontinued operations
    —       0.03       —  
 
                 
 
  $ 0.01     $ (0.10 )   $ 0.00  
 
                 
 
                       
Weighted average common shares outstanding
                       
Basic
    2,293.9       2,280.5       2,262.6  
Diluted
    2,306.4       2,280.5       2,269.5  
 
                       
Dividends paid per share
  $ —     $ 0.05     $ 0.05  
 
                       
    Percentage of Net Sales*  
Net sales
    100 %     100 %     100 %
Costs of sales
    68.9 %     72.1 %     71.2 %
 
                 
Gross margin
    31.1 %     27.9 %     28.8 %
 
                 
 
                       
Selling, general and administrative expenses
    15.0 %     16.2 %     13.8 %
Research and development expenditures
    14.1 %     15.8 %     13.0 %
Separation-related transaction costs
    0.0 %     0.0 %     0.2 %
Other charges
    0.6 %     2.9 %     0.7 %
Intangibles amortization and IPR&D
    1.3 %     1.3 %     1.0 %
 
                 
Operating earnings (loss)
    0.2 %     -8.4 %     0.1 %
 
                 
 
                       
Other income (expense):
                       
Interest expense, net
    -0.5 %     -0.7 %     -0.1 %
Gain (loss) on sales of investments and businesses, net
    0.5 %     -0.4 %     0.5 %
Other
    0.4 %     1.3 %     -1.1 %
 
                 
Total other income (expense)
    0.4 %     0.3 %     -0.8 %
 
                 
Earnings (loss) from continuing operations before income taxes
    0.6 %     -8.1 %     -0.7 %
Income tax benefit
    0.0 %     -2.7 %     -0.7 %
 
                 
Earnings (loss) from continuing operations
    0.6 %     -5.4 %     0.0 %
 
                       
Earnings from discontinued operations, net of tax
    0.0 %     1.1 %     0.0 %
 
                 
Net earnings (loss)
    0.6 %     -4.2 %     0.0 %
 
                       
Less: Earnings (loss) attributable to the noncontrolling interest
    0.2 %     0.1 %     -0.1 %
 
                 
Net earnings (loss) attributable to Motorola, Inc.
    0.5 %     -4.3 %     0.0 %
 
                 
*   Percents may not add up due to rounding

 

 

Motorola, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In millions, except per share amounts)
                 
    Six Months Ended  
    July 4, 2009     June 28, 2008  
Net sales
  $ 10,868     $ 15,530  
Costs of sales
    7,662       11,060  
 
           
Gross margin
    3,206       4,470  
 
           
 
               
Selling, general and administrative expenses
    1,691       2,298  
Research and development expenditures
    1,622       2,102  
Separation-related transaction costs
    —       20  
Other charges
    191       150  
Intangibles amortization and IPR&D
    141       164  
 
           
Operating loss
    (439 )     (264 )
 
           
 
               
Other income (expense):
               
Interest expense, net
    (65 )     (12 )
Gain on sales of investments and businesses, net
    10       58  
Other
    93       (97 )
 
           
Total other income (expense)
    38       (51 )
 
           
 
               
Loss from continuing operations before income taxes
    (401 )     (315 )
 
               
Income tax benefit
    (148 )     (122 )
 
           
Loss from continuing operations
    (253 )     (193 )
 
               
Earnings from discontinued operations, net of tax
    60       —  
 
           
Net loss
    (193 )     (193 )
 
               
Less: Earnings (loss) attributable to the noncontrolling interest
    12       (3 )
 
           
Net loss attributable to Motorola, Inc.
  $ (205 )   $ (190 )
 
           
 
               
Amounts attributable to Motorola, Inc. common shareholders
               
Loss from continuing operations, net of tax
  $ (265 )   $ (190 )
Earnings from discontinued operations, net of tax
    60       —  
 
           
Net loss
  $ (205 )   $ (190 )
 
           
 
               
Earnings (loss) per common share
               
Basic:
               
Continuing operations
  $ (0.12 )   $ (0.08 )
Discontinued operations
    0.03       —  
 
           
 
  $ (0.09 )   $ (0.08 )
 
           
 
               
Diluted:
               
Continuing operations
  $ (0.12 )   $ (0.08 )
Discontinued operations
    0.03       —  
 
           
 
  $ (0.09 )   $ (0.08 )
 
           
 
               
Weighted average common shares outstanding
               
Basic
    2,286.5       2,260.5  
Diluted
    2,286.5       2,260.5  
 
               
Dividends paid per share
  $ 0.05     $ 0.10  
 
               
    Percentage of Net Sales*  
Net sales
    100 %     100 %
Costs of sales
    70.5 %     71.2 %
 
           
Gross margin
    29.5 %     28.8 %
 
           
 
               
Selling, general and administrative expenses
    15.6 %     14.8 %
Research and development expenditures
    14.9 %     13.5 %
Separation-related transaction costs
    0.0 %     0.1 %
Other charges
    1.8 %     1.0 %
Intangibles amortization and IPR&D
    1.3 %     1.1 %
 
           
Operating loss
    -4.0 %     -1.7 %
 
           
 
               
Other income (expense):
               
Interest expense, net
    -0.6 %     -0.1 %
Gain on sales of investments and businesses, net
    0.1 %     0.4 %
Other
    0.9 %     -0.6 %
 
           
Total other income (expense)
    0.3 %     -0.3 %
 
           
Loss from continuing operations before income taxes
    -3.7 %     -2.0 %
Income tax benefit
    -1.4 %     -0.8 %
 
           
Loss from continuing operations
    -2.3 %     -1.2 %
 
               
Earnings from discontinued operations, net of tax
    0.6 %     0.0 %
 
           
Net loss
    -1.8 %     -1.2 %
 
               
Less: Earnings (loss) attributable to the noncontrolling interest
    0.1 %     0.0 %
 
           
Net loss attributable to Motorola, Inc.
    -1.9 %     -1.2 %
 
           
*   Percents may not add up due to rounding

 

 

Motorola, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In millions)
                         
    July 4,     April 4,     June 28,  
    2009     2009     2008  
Assets
                       
Cash and cash equivalents
  $ 2,881     $ 3,265     $ 2,757  
Sigma Fund
    3,489       2,587       3,856  
Short-term investments
    45       19       595  
Accounts receivable, net
    3,689       3,689       4,495  
Inventories, net
    1,660       2,071       2,758  
Deferred income taxes
    1,320       1,161       1,882  
Other current assets
    2,630       2,919       3,876  
 
                 
Total current assets
    15,714       15,711       20,219  
 
                 
 
                       
Property, plant and equipment, net
    2,280       2,322       2,575  
Sigma Fund
    72       257       555  
Investments
    446       498       746  
Deferred income taxes
    2,094       2,445       3,074  
Goodwill
    2,822       2,822       4,358  
Other assets
    1,676       1,708       2,212  
 
                 
Total assets
  $ 25,104     $ 25,763     $ 33,739  
 
                 
 
                       
Liabilities and Stockholders’ Equity
                       
Notes payable and current portion of long-term debt
  $ 40     $ 63     $ 145  
Accounts payable
    2,188       2,265       3,806  
Accrued liabilities
    5,956       6,728       7,623  
 
                 
Total current liabilities
    8,184       9,056       11,574  
 
                 
 
                       
Long-term debt
    3,899       3,878       3,971  
Other liabilities
    3,398       3,463       2,886  
 
                       
Total Motorola, Inc. stockholders’ equity
    9,523       9,275       15,204  
 
                 
 
                       
Noncontrolling interest
    100       91       104  
 
                 
 
                       
Total liabilities and stockholders’ equity
  $ 25,104     $ 25,763     $ 33,739  
 
                 
 
                       
Financial Ratios:
                       
Total cash*
  $ 6,487     $ 6,128     $ 7,763  
*Total cash = Cash and cash equivalents + Sigma Fund (current and non-current) + Short-term investments

 

Motorola, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In millions)
                         
    Three Months Ended  
    July 4, 2009     April 4, 2009     June 28, 2008  
Operating
                       
Net earnings (loss) attributable to Motorola, Inc.
  $ 26     $ (231 )   $ 4  
Less: Earnings (loss) attributable to the noncontrolling interest
    9       3       (7 )
 
                 
Net earnings (loss)
    35       (228 )     (3 )
Earnings from discontinued operations, net of tax
    —       60       —  
 
                 
Earnings (loss) from continuing operations
    35       (288 )     (3 )
Adjustments to reconcile loss from continuing operations to net cash provided by (used for) operating activities:
                       
Depreciation and amortization
    192       190       212  
Non-cash other charges (income)
    (9 )     4       117  
Share-based compensation expense
    74       76       88  
Loss (gain) on sales of investments and businesses, net
    (30 )     20       (39 )
Gain from the extinguishment of long-term debt
    —       (67 )     —  
Deferred income taxes
    162       (197 )     (192 )
Changes in assets and liabilities, net of effects of acquisitions and dispositions:
                       
Accounts receivable
    1       (204 )     246  
Inventories
    408       582       183  
Other current assets
    290       217       (104 )
Accounts payable and accrued liabilities
    (848 )     (1,355 )     (159 )
Other assets and liabilities
    (125 )     8       (145 )
 
                 
Net cash provided by (used for) operating activities
    150       (1,014 )     204  
 
                 
Investing
                       
Acquisitions and investments, net
    (6 )     (15 )     (34 )
Proceeds from sales of investments and businesses, net
    89       137       51  
Distributions from investments
    —       —       81  
Capital expenditures
    (66 )     (71 )     (120 )
Proceeds from sales of property, plant and equipment
    3       3       —  
Proceeds from sales (purchases) of Sigma Fund investments, net
    (649 )     1,319       156  
Proceeds from sales (purchases) of short-term investments, net
    (26 )     206       (130 )
 
                 
Net cash provided by (used for) investing activities
    (655 )     1,579       4  
 
                 
Financing
                       
Repayment of commercial paper and short-term borrowings, net
    (23 )     (31 )     (27 )
Repayment of debt
    —       (129 )     —  
Issuance of common stock
    —       56       76  
Payment of dividends
    —       (114 )     (113 )
Other, net
    6       —       (6 )
 
                 
Net cash used for financing activities
    (17 )     (218 )     (70 )
 
                 
Effect of exchange rate changes on cash and cash equivalents
    138       (146 )     (74 )
 
                 
Net increase (decrease) in cash and cash equivalents
    (384 )     201       64  
Cash and cash equivalents, beginning of period
    3,265       3,064       2,693  
 
                 
Cash and cash equivalents, end of period
  $ 2,881     $ 3,265     $ 2,757  
 
                 

 

 

Motorola, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In millions)
                 
    Six Months Ended  
    July 4, 2009     June 28, 2008  
Operating
               
Net loss attributable to Motorola, Inc.
  $ (205 )   $ (190 )
Less: Earnings (loss) attributable to the noncontrolling interest
    12       (3 )
 
           
Net loss
    (193 )     (193 )
Earnings from discontinued operations, net of tax
    60       —  
 
           
Loss from continuing operations
    (253 )     (193 )
Adjustments to reconcile loss from continuing operations to net cash used for operating activities:
               
Depreciation and amortization
    382       416  
Non-cash other charges (income)
    (5 )     116  
Share-based compensation expense
    150       166  
Gain on sales of investments and businesses, net
    (10 )     (58 )
Gain from the extinguishment of long-term debt
    (67 )     —  
Deferred income taxes, including change in valuation allowance
    (35 )     (470 )
Changes in assets and liabilities, net of effects of acquisitions and dispositions:
               
Accounts receivable
    (203 )     873  
Inventories
    990       137  
Other current assets
    507       (270 )
Accounts payable and accrued liabilities
    (2,203 )     (795 )
Other assets and liabilities
    (117 )     (61 )
 
           
Net cash used for operating activities
    (864 )     (139 )
 
           
Investing
               
Acquisitions and investments, net
    (21 )     (174 )
Proceeds from sales of investments and businesses, net
    226       71  
Distributions from investments
    —       82  
Capital expenditures
    (137 )     (231 )
Proceeds from sales of property, plant and equipment
    6       5  
Proceeds from sales of Sigma Fund investments, net
    670       787  
Proceeds from sales of short-term investments, net
    180       17  
 
           
Net cash provided by investing activities
    924       557  
 
           
Financing
               
Repayment of commercial paper and short-term borrowings, net
    (54 )     (81 )
Repayment of debt
    (129 )     (114 )
Issuance of common stock
    56       82  
Purchase of common stock
    —       (138 )
Payment of dividends
    (114 )     (227 )
Other, net
    6       (7 )
 
           
Net cash used for financing activities
    (235 )     (485 )
 
           
Effect of exchange rate changes on cash and cash equivalents
    (8 )     72  
 
           
Net increase (decrease) in cash and cash equivalents
    (183 )     5  
Cash and cash equivalents, beginning of period
    3,064       2,752  
 
           
Cash and cash equivalents, end of period
  $ 2,881     $ 2,757  
 
           

 

 

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)
Summarized below are the Company’s Net sales by reportable segment for the three and six months ended July 4, 2009 and June 28, 2008.
                         
    Net Sales  
    Three Months Ended     Three Months Ended     % Change from  
    July 4, 2009     June 28, 2008     2008  
 
                       
Mobile Devices
  $ 1,829     $ 3,334       -45 %
Home and Networks Mobility
    2,001       2,738       -27 %
Enterprise Mobility Solutions
    1,685       2,042       -17 %
 
                 
Segment Totals
    5,515       8,114       -32 %
Other and Eliminations
    (18 )     (32 )     -44 %
 
                 
Company Totals
  $ 5,497     $ 8,082       -32 %
 
                 
 
                       
    Net Sales  
    Six Months Ended     Six Months Ended     % Change from  
    July 4, 2009     June 28, 2008     2008  
Mobile Devices
  $ 3,630     $ 6,633       -45 %
Home and Networks Mobility
    3,992       5,121       -22 %
Enterprise Mobility Solutions
    3,284       3,848       -15 %
 
                 
Segment Totals
    10,906       15,602       -30 %
Other and Eliminations
    (38 )     (72 )     -47 %
 
                 
Company Totals
  $ 10,868     $ 15,530       -30 %
 
                 

 

 

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)
Summarized below are the Company’s Operating earnings (loss) by reportable segment for the three and six months ended July 4, 2009 and June 28, 2008.
                 
    Operating Earnings (Loss)  
    Three Months Ended     Three Months Ended  
    July 4, 2009     June 28, 2008  
Mobile Devices
  $ (253 )   $ (346 )
Home and Networks Mobility
    153       245  
Enterprise Mobility Solutions
    227       377  
 
           
Segment Totals
    127       276  
Other and Eliminations
    (117 )     (271 )
 
           
Company Totals
  $ 10     $ 5  
 
           
 
               
    Operating Earnings (Loss)  
    Six Months Ended     Six Months Ended  
    July 4, 2009     June 28, 2008  
Mobile Devices
  $ (762 )   $ (764 )
Home and Networks Mobility
    268       398  
Enterprise Mobility Solutions
    383       627  
 
           
Segment Totals
    (111 )     261  
Other and Eliminations
    (328 )     (525 )
 
           
Company Totals
  $ (439 )   $ (264 )