When Google bid $12.5 billion for Motorola Mobility last August, the search giant said the deal could “supercharge the entire Android ecosystem.” However reporting a $80 million operating loss for the last quarter of 2011, it seems as if Google will need to concentrate on Motorola first before supercharging an entire ecosystem.
Earlier this month Motorola signalled that the fourth quarter returns would be lower than previously expected and the actual results announced last night, came in pretty much as per the revised figures.
Motorola reported a net loss of $80m compared with a net profit of $80m in the same period last year. This was on the back of revenue of $3.436bn which was only very slightly above the previous year’s figure of $3.425bn.
While revenue from mobile devices – including smartphones like the Droid Razr and tablets like the Motorola Xoom 2 – rose five per cent to $2.5bn, revenue from set-top boxes dipped by 11 per cent year-on-year to just $879m.
Motorola Mobility still expects the Google deal to close early this year. The companies are awaiting approval from regulators in several countries, including the United States, China, Europe and Canada.
Motorola said China started phase two of its investigation in December and the European Commission is not expected to announce until February whether or not it will expand its review.
The deal also requires approval from Israel and Taiwan, according to Motorola Mobility, which said that Russia and Turkey have already given their approval.
While the loss reported for the last quarter won’t be welcome news, investors still seem confident that the Google deal will go through, with shares still trading close to the $40 price set back in August.
Of course Google’s interest in Motorola is not mainly in the company’s current mobile devices, but more in the patents held by Motorola, as Google braces itself for another year battling Apple in the courts in relation to its Android operating system and the phones and tablets it is used on.