Google revealed that its Motorola Mobility unit saw another operating loss in the first quarter of 2013, shortly after Eric Schmidt promised that the hardware unit is working on devices that are “phenomenal”.
The division recorded an operating loss of $271 million for the period, on revenue of $1.02 billion.
The business was not owned by Google last year, but in the prior sequential quarter (which included the lucrative Christmas holiday sales period) it saw an operating loss of $353 million on revenue of $1.51 billion.
Speaking at the D:Dive into Mobile event earlier this week, Eric Schmidt, executive chairman of Google, said: “What I would advise you to do with Motorola is wait and see for this next generation of technology. It’s very impressive.”
In a conference call, Google noted that while it is “seeing a lot of progress across the board” with the transformation of Motorola, “results from that segment will continued to be variable”.
Earlier this week Google completed the sale of Motorola’s Home business to Arris Group, which is active in the same space, for $2.2 billion in cash and shares equivalent to around 7.7 per cent of Arris.
And contract manufacturing company Flextronics also completed a deal to take over a Motorola facility in China, and assumed management and operational responsibility for a Motorola site in Brazil.
Moving on to Google’s core “advertising and other” business, sales increased to $12.95 billion in the three months from $10.65 billion.
During February 2013, the company launched “a significant upgrade to AdWords” called Enhanced Campaigns, which is designed to allow advertisers to offer campaigns across multiple device types, with material “dynamically adapted” by Google.
“Online advertising has developed in a very device specific ways with separate campaigns for desktop and mobile. This makes arduous work for advertisers and agencies, and means mobile opportunities often get missed,” Larry Page, CEO of Google, said.
On a group level, Google reported a profit of $3.35 billion, up from $2.89 billion, on revenue of $13.97 billion, up from $10.65 billion.
It also noted $153 million in amortisation related to the Motorola deal, of which $116 million was allocated to Google, and $37 million to Motorola.