Motorola's Home Sales Drop 18% In Q1

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Sales in Motorola's Home segment, which sells video and broadband equipment and software to service providers, dropped 18% in the first quarter of 2010 to $838 million, compared with $1.03 billion in the year-ago quarter.

Operating earnings for the Home segment were $20 million, compared with $3 million in the year-ago quarter. The division shipped 3.1 million set-top boxes and other digital entertainment devices the quarter -- down about 28% from 4.3 million in the first quarter of 2009.

Still, Motorola is "cautiously optimistic" that spending trends in the video and broadband sector are improving, John Burke, senior vice president of the Mobile Devices and Home unit, said in an interview Thursday.

"We are seeing good strength on the infrastructure side," he said. "I think the industry took a bit of a pause on their investment in video infrastructure last year and we have seen that rebound in the last two quarters."

Burke noted that Motorola's Home division has taken steps to reduce costs in the past year which has improved profitability.

During the quarter, Motorola announced a revised plan to break itself up, aiming to split into two separate companies by the first quarter of 2011: one that will merge mobile devices and the Home business, and the other combining its wireless networking and enterprise units. Sanjay Jha, previously co-CEO of Motorola heading up the Mobile Devices division, now serves as CEO of Motorola's Mobile Devices and Home businesses.

Overall, Motorola reported $5.04 billion in revenue and eked out a net profit of $68 million for the quarter ended April 3, 2010. That's compared with $5.37 billion and net loss of $228 million in the first quarter of 2009.

Mobile Devices segment sales were $1.6 billion, down 9% versus the year-ago quarter, with an operating loss of $192 million compared with $545 million in the first-quarter 2009.