By Saabira Chaudhuri
Motorola Solutions Inc.'s (MSI) first-quarter profit rose 22% as
the company benefited from lower income tax expenses, although
revenue grew less than expected and the company offered a weak view
for the current quarter.
The Schaumburg, Ill., provider of public-safety radios, handheld
scanners and telecommunications-network gear, had previously said
it expects that 2013 to continue to show strength from its
government customers, while bringing in modest growth on the
business, or enterprise, side. Chief Executive Greg Brown has
projected that overall information-technology spending by
businesses will gain steam in the next several months and will
benefit from Europe's economy stabilizing.
But on Wednesday the company projected adjusted earnings of 66
cents to 71 cents a share for the current quarter, with sales flat
to down 2%. Analysts polled by Thomson Reuters recently expected
per-share earnings of 86 cents on sales growth of 5%.
Overall, Motorola Solutions posted a profit of $192 million, or
68 cents a share, versus a year-ago profit of $157 million, or 49
cents a share. The latest results included an income-tax expense of
$13 million versus the year-ago's $85 million. Excluding one-time
items, earnings from continuing operations were up at 66 cents from
59 cents.
Revenue edged up 0.9% to $1.97 billion.
The company had predicted per-share earnings from continuing
operations of 62 cents to 67 cents on sales growth of 4% to 5%.
Gross margin narrowed to 48.4% from 49.7%.
Government sales increased 3.5% to $1.35 billion. The smaller
enterprise business posted a 4.3% drop in revenue.
The company was created in 2011 from the split of Motorola Inc.
The spinoff put the higher-profile mobile-devices and
TV-set-top-box operations into Motorola Mobility Holdings Inc.,
which was later acquired by Google Inc. (GOOG) for $12.5
billion.
Shares closed Tuesday at $61.75 and were inactive in recent
premarket trading. The stock has risen 27% in the past 12
months.
Write to Saabira Chaudhuri at saabira.chaudhuri@dowjones.com
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