News by Andrew Kameka on Thursday July 18, 2013.
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Google spent $12.5 billion to acquire Motorola for its patent portfolio and to have a company that will directly build and sell its Android products, but the Motorola acquisition isn't contributing any positive news to Google's bottom line. Google today released its earnings report for the second quarter of 2012, and Motorola lost money once again.
Google reported revenue of $14.11 billion, a 19 percent increase compared to the same period the previous year. That was still short of the $14.45 billion that Wall Street analysts predicted for the company. The vast majority of revenues came from Google's advertising and web services. Motorola, which had no major product announcements during the quarter, reported an operating loss of $342 million, a 34 percent decline compared to the same quarter in 2012. The wireless subsidiary reported revenue of $998 million but spent more money than it brought in.
The Moto X smartphone and a new set of DROID devices for Verizon could potentially turn things around in the future. Motorola might have two major announcements next week that could potentially push the company towards a more successful relationship with Google.
Google is not troubled by the loss of money Motorola reports because it believes better days are ahead and Motorola has already led to an infusion of cash thanks to the sale of his home business.
"You have to put the acquisition in context," Google CFO Patrick Pichette said during the company's earnings call. Pichette added that Google is pleased with the leaner Motorola that has less than 5,000 employees and is on the verge of launching new products.
"I'll leave it to the coming quarters to demonstrate the new Motorola that's coming up. You'll see that in the coming weeks, actually," Pichette concluded.source: Google
Andrew is MobileBurn.com's managing editor. He is based in Miami, Florida.