Motorola slumps on slow sales

NEW YORK - Shares of Motorola, the world's second-biggest maker of mobile phones, may fall further after the company reported a 45 per cent drop in third-quarter profit and missed its sales forecast.

Motorola, based in Schaumburg, Illinois, posted the slowest sales growth in five years after shipping fewer phones than it anticipated. Sales this period may not match analysts' average estimate of US$12.1 billion ($18.2 billion), the company said.

Motorola's report may signal demand is waning for mobile phones and the equipment that runs them. Market leader Nokia plans to report earnings today. Results yesterday from IBM and Intel, while better than some analysts estimated, weren't enough to spark optimism about the quarter.

"I'm overall lukewarm based on these results," said Daniel Morgan, at Synovus Investment Advisers in Florida. "Motorola wasn't as bad as the headlines, IBM was OK, and Intel still has things to worry about."

Shares of Motorola dropped US$1.87, or 7.5 per cent, to US$22.98 in extended NYSE trading. Should the decline continue in regular trading, the drop would be the biggest since January.

- BLOOMBERG