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Motorola posts a loss as it falls behind Samsung in market share

NEW YORK (Reuters) — Motorola Inc. posted its second straight quarterly loss yesterday as a lack of advanced mobile phones cost the company market share and dropped it into third place in the industry behind Nokia and Samsung Electronics.Motorola's results were in line with lowered expectations following the company's earnings warning last week. But it further disappointed some analysts by failing to give a revenue forecast for the third quarter.

"The big worry remains the top line, and market share in handsets, where they're ceding a ton," said Cowen & Co analyst Matthew Hoffman.

Motorola said it shipped 35.5 million mobile phones in the second quarter, giving it an estimated 13.5 percent share of the global market, down from about 17.5 percent in the first quarter. JPMorgan analyst Ehud Gelblum estimated Motorola's share at an even lower 12.8 percent for the second quarter.

The latest figures show that Samsung overtook Motorola as the industry No. 2, behind Nokia in the quarter.

After four straight disappointing quarters, Motorola chief executive Ed Zander has come under increasing pressure from shareholders, some of whom have called for his ouster.

But chief financial officer Tom Meredith, who also sits on the Motorola board, told Reuters in an interview that the company was not looking for a successor and was confident in its leadership team.

Motorola posted a second-quarter loss from continuing operations of $38 million, or 2 cents a share, compared with a year-earlier profit of $1.35 billion, or 54 cents per share.

Including earnings from discontinued operations, Motorola's net loss was $28 million, or 1 cent per share.

Net sales fell 19 percent to $8.7 billion.

Hoffman said it was worrying that Motorola appeared to lose market share not only to Nokia, but to smaller rivals such as LG Electronics and Sony Ericsson, a venture of Sony Corp and Ericsson.

In a conference call with analysts, CEO Zander said that Motorola was "doing the right things."

But he added, "Make no mistake about it, there is still a lot more to do."