UPDATE: Motorola Solutions Posts Downbeat Q2 Results, Issues Weak Forecast

Shares of Motorola Solutions

tumbled more than 6% in pre-market trading after the company reported downbeat second-quarter results and issued a weak forecast for the current period. For the third quarter, Motorola projects adjusted earnings of $0.35 to $0.41 per share, and a drop of 7% to 9% in revenue. Analysts expected earnings of $1.02 per share on flat revenue. The Schaumburg, Illinois-based company posted a quarterly profit of $824 million, or $3.22 per share, versus a year-ago profit of $258 million, or $0.94 per share. Its adjusted earnings from operations dropped 50% to $0.47 per share in the quarter, versus $0.94 per share. Its sales dropped 7% to $1.39 billion in the quarter. Motorola had expected earnings of $0.58 to $0.64 per share on a revenue drop of 5% to 8%. However, analysts were expecting earnings of $0.62 per share on revenue of $1.96 billion. Motorola's product sales fell 10% to $887 million in the quarter, while services sales dipped 1% to $506 million. Its gross margin shrank to 47.1% versus 50.1%, while input costs slipped 1.3%. “Second quarter results were in line with our expectations. Additionally, we made significant progress toward simplifying our operations and accelerating our cost reduction efforts,” Greg Brown, chairman and CEO, Motorola Solutions said. Motorola has raised its target for cost reductions from $200 million to around $300 million by the end of 2015. It repurchased $416 million of its common stock in the quarter. Motorola shares fell 6.40% to $60.01 in pre-market trading.