Ahead of the Bell: Motorola's 'Cliq' not clicking

AP News
Posted: Nov 30, 2009 8:58 AM

Motorola Inc.'s shipments of smartphones seem to be running slightly behind its target for the quarter, but not enough to hurt earnings, an analyst said Monday.

Oppenheimer analyst Ittai Kidron said shipments of the Droid phone is meeting expectations, but the Cliq is falling behind due to problems with battery life. While Motorola is expected to release a software patch to fix the problem, T-Mobile's interest in the phone has diminished, leading to lower sales of the unit.

But strength in Motorola's other products will make up for the small shortfall in smart phone shipments and shouldn't cause the company to miss its earnings target.

Kidron expects Motorola to ship 900,000 phones in the quarter and meet its outlook for 7 cents to 9 cents in earnings. Analysts on average expect 8 cents per share, according to Thomson Reuters.

"Competitive pressures will rise, but overall we believe the company is on the right track to 2010 year-end profitability," the analyst said in a research note.

Shares of Schaumburg, Ill.-based Motorola rose 4 cents to $8.24 in premarket trading.