Fittest loser
Article updated: 4/24/2013 11:53 AM

Motorola Solutions sees profit dip, no drastic measures

Greg Brown

Greg Brown

 
Motorola Solutions headquarters in Schaumburg.

Motorola Solutions headquarters in Schaumburg.

 

Bill Zars | Staff Photographer

Motorola Solutions headquarters in Schaumburg.

Motorola Solutions headquarters in Schaumburg.

 

Bill Zars | Staff Photographer

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Although Motorola Solutions' profit dipped during the first quarter, the Schaumburg-based communications company said Wednesday it has no plans to lay off or otherwise cut back.

The economy forced many retailers and other enterprise customers to hold back on technology purchases, so Motorola plans to continue its routine diligence on holding down costs, CEO Greg Brown told the Daily Herald during an interview.

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"I don't anticipate any big events," Brown said. "We still expect growth."

Motorola Solutions posted first-quarter sales of about $2 billion, up 1 percent from the same period a year ago, mostly boosted by sales in its government and public sector unit. Sales in the commercial and enterprise unit were down about 4 percent. Operating earnings were $216 million, down from $232 million the year before, or about 7 percent, the company said in a release.

Brown said the company remains optimistic that it will increase revenue in the lagging enterprise unit by strengthening its sales force, rolling out new products and managing its cost structure.

"I'd like to think we do a good job of that quarter in and quarter out," Brown said. "But we'll continue to remain disciplined on our operating cost structure and will remain diligent."

Some new products could include a new ruggedized tablet for businesses that includes the Microsoft's Windows 8 handheld platform. Brown told analysts on Wednesday that the company will release several devices with Windows 8 with the tablet-style device becoming available by early 2014, said Michael Soper, an analyst with Technology Business Research Inc.

"The ruggedized nature of these devices is one of the two key selling points, with the other being that Microsoft applications, such as Word and Excel, can be ported to Windows Embedded 8. Motorola has been building products running Windows Mobile and Windows Embedded Handheld 6.5 for years, but Windows 8 applications compatibility will enable users to run enterprise-specific applications like Dynamics and Lync," Soper said in an email. "While there is a market for a ruggedized Windows Embedded 8 tablet, cautious optimism is necessary, considering Windows 8 was unable to reverse negative growth in the PC market and Windows 8 consumer tablets have seen a lackluster reception."

Besides the earnings, Brown said the company is on target with staffing its sales headquarters in downtown Chicago that will focus on North American and Latin American territories. The ongoing plan remains the same, to staff the headquarters with sales people from the Schaumburg campus and other offices.

Motorola announced in mid-2011 that it would add about 400 workers to its operations in Chicago without taking an incentive package from Chicago or the state to do it. That move is expected to continue through later this year.

"There are no changes from our original plan," Brown said.

Also, the company continues to have two major buildings for lease or sale on its Schaumburg campus. Brown declined to say who has been looking or whether any deals are close.

In February 2011, the Daily Herald reported first that the legendary campus was about aiming to lease the so-called Parts Building, used primarily as a warehouse with about 260,000 square feet, and the IT Building, which has specialized devices and equipment with about 170,000 square feet. The company had hoped to use the rental fees to help offset expenses for operating the buildings.

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