By Lisa Beilfuss
Motorola Solutions Inc. said Wednesday that private-equity firm
Silver Lake will take a $1 billion stake in the company.
Separately, the company reported a decline in second-quarter
earnings, because of a one-time gain that lifted the year-earlier
period and on account of adverse foreign exchange rates.
Adjusted results beat the company's guidance.
Motorola said the Silver Lake investment will enable it to speed
up growth in its smart public-safety solutions and services
businesses. The company expects to complete the transaction in the
third quarter.
Chicago-based Motorola Solutions is what remains of Motorola
Inc., the wireless communications pioneer that has been dismantled
over recent years. In 2012, Google Inc. bought Motorola Mobility
for $12.5 billion, and then last year sold some of the business to
China's Lenovo Group Ltd. for $2.9 billion. Last year, Motorola
Solutions sold its scanner business to Zebra Technologies Corp. for
$3.5 billion.
In recent quarters, strength in North America has helped offset
sales declines elsewhere. And in its latest quarter, revenue from
North America, which accounts for more than half of the top line,
grew 5%. Meanwhile, weakness in international sales has led to
overall declines in both the product and services categories.
Overall for the June quarter, the company earned $142 million,
down from $824 million a year earlier. Per-share earnings fell to
68 cents from $3.22 cents. Excluding items, earnings per share
increased to 68 cents from 47 cents. The year-earlier period
included a $746 million gain from discontinued operations.
Revenue slipped 1.7% to $1.4 billion.
The company had guided for earnings of 51 cents to 56 cents on
revenue of $1.32 billion to $1.35 billion.
Foreign exchange sliced $53 million off the top line, Motorola
said. In the previous quarter, the company took a $40 million
currency hit.
Motorola on Wednesday backed its full-year earnings outlook,
reiterating that it expects to report $3.20 to $3.40 in profit per
share this year on revenue that is flat to down 2% from a year
earlier. That revenue estimate translates to roughly $5.76 billion
to $5.88 billion. Analysts have predicted $3.27 in per-share profit
and $5.81 billion in sales, according to Thomson Reuters.
For the current quarter, the company expects earnings of 68
cents to 73 cents a share, short of the 83 cents analysts have
estimate.
Shares in the company, down about 11% this year, were inactive
premarket.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires