Motorola Narrowly Exceeds Forecasts

Motorola Inc. posted a loss for a second straight quarter amid a deep slump in the cell phone and semiconductor industries, but it narrowly beat Wall Street’s reduced expectations.

Despite the latest signs of deterioration in its main businesses, Motorola’s shares rose sharply in extended trading after the report, which said the company’s broad restructuring has begun to bring improvements in orders and new products.

Motorola’s operating loss was $232 million, or 11 cents a share, for the latest quarter, contrasted with a profit of $551 million, or 25 cents, a year earlier.

Analysts polled by First Call/Thomson Financial had forecast a loss of 12 cents, after the company warned in April that it expected results would be a few cents worse than the first-quarter’s 9-cent loss.

Revenue fell 19% to $7.5 billion, with declines in most of Motorola’s businesses. The company had said in April that it expected sales to be somewhat higher than the first-quarter’s $7.8 billion.

Shares of Schaumburg, Ill.-based Motorola rose more than $1 in after-hours trading, after finishing the regular session up 17 cents at $15.67 on the New York Stock Exchange.

The stock has lost more than half its value since October, but has risen steadily in recent weeks on investors’ hopes the company’s troubles are bottoming out.

Robert Growney, president and chief operating officer, said that despite the continuing losses, “The actions we have taken to improve the performance of the wireless telephone segment of our business are beginning to show positive results with new products and orders.”

The company is in the midst of its third restructuring since 1998 and has said it will cut 26,000 jobs out of 147,000 worldwide.

“It’s impressive that they beat the numbers, but there’s weakness across the board,” said analyst Todd Bernier, who follows the company for Chicago-based Morningstar.

“They lost more money than the last quarter,” he said. “I fail to see the great turnaround in this.”

Underlining the depth of the drop-off, orders declined 9% for cell phones, 51% for semiconductors and 16% for broadband communications equipment, Motorola’s report said.

Sales in the mobile phone division fell 25% to $2.5 billion, and semiconductor sales dropped 38% to $1.3 billion, which the company attributed to the faltering global economy.

Sales in the growing broadband unit, which has been a rare bright spot for Motorola in recent quarters, rose 7% to $820 million.

In the integrated electronic systems segment, sales fell 19% to $549 million.

Motorola executives are expected to give additional details in a conference call today before markets open.