Motorola is dumping Mobile phone division
Motorola has just issued a press release that it’s:
“…exploring the structural and strategic realignment of its businesses to better equip its Mobile Devices business to recapture global market leadership and to enhance shareholder value. The company’s alternatives may include the separation of Mobile Devices from its other businesses in order to permit each business to grow and better serve its customers.”
Now, I’m no corporate speak expert, but from my stock playing days I remember, that these kind of “strategic explorations” mean only one thing. The company has made a decision to dump the underperforming unit, and is announcing to the world that it is for sale. They might have even received some offers for it, but are not really satisfied with price, and now are looking if they can get a better one.
Well, after last year I’m not surprised. Their new RAZR line failed to recapture previous excitement, current flagship MOTO Z8 is hopelessly outdated, the features of the upcoming Motorola Z10 are way behind the competition, their numerous leaks about exciting new phone line-up failed to produce any result (and even if real , they won’t get to market before Q4), and the phone division lost over a billion dollars last year.
So, what happens now? With the results like these, the spin-off is unlikely. My guess is, that there will be either a private equity buyout, or the repeat of IBM/Lenovo story.
Some enterprising Chinese ODM with the worldwide expansion ambitions, will pick up the struggling division. They will get all the MOTO Mobile assets, plus the right to sell mobile phones under Motorola brand for a few years.