Motorola stock plunges after company calls for Q2 revenue drop, withdraws guidance
Shares of Motorola Solutions Inc. fell nearly 16% in the extended session Thursday after the telecommunications equipment maker beat Wall Street expectations for its first quarter but told investors to brace for a sales drop in the second quarter due to the coronavirus pandemic. Motorola said it earned $197 million, or $1.12, in the first quarter, compared with earnings of $151 million, or 86 cents a share, in the year-ago period. Adjusted for one-time items, the company reported profit of $1.49 a share. Sales were flat at $1.7 billion, the company said. Analysts polled by FactSet expected adjusted profit of $1.27 a share on sales of $1.66 billion. Due to the coronavirus pandemic, the company drew down $800 million from a credit facility in the quarter, and ended the period with $1.7 billion in cash and had $1.4 billion of additional committed, undrawn capacity on the revolving credit facility, it said. Motorola ended the quarter with $5.9 billion in debt, including the $800 million from the facility. Motorola said it expects a revenue decline between 17% and 14% for second-quarter sales as compared with second quarter 2019, and non-GAAP per-share earnings in a range between $1.18 and $1.27 for the quarter. Motorola withdrew its 2020 guidance due to "uncertainty surrounding the COVID-19 pandemic." Shares of Motorola had ended the regular trading day up 0.7%.
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