Moody's may cut Freescale's debt rating

NEW YORK, Oct 24 (Reuters) - Moody's Investors Service on Wednesday said it may cut its ratings on Freescale Semiconductor Inc, citing weakness in the company's wireless revenues.

Lower demand from Freescale's former parent and largest customer, Motorola (MOT.N), has contributed to weakness in the wireless segment, Moody's said in a statement. Motorola accounts for about 20 percent to 25 percent of Freescale's revenues, the rating agency said.

"With Motorola's continued woes, Moody's believes Freescale will be challenged to expand its wireless customer base in a timely manner," the agency said. Motorola has been struggling to return to profit amid weak sales of its cell phones.

Moody's now rates Freescale "Ba3," three steps below investment grade.

Freescale's 10.125 percent notes due in 2016 fell to 90.75 cents on the dollar on Wednesday, down 1.25 cents on the day, according to MarketAxess.