LOS ANGELES (Reuters) - Shares of cell phone maker Motorola Inc MOT.N fell 7 percent on Thursday, hitting a five-year low on fears the company was losing ground to competitors.
Carrier Sprint Nextel Corp S.N on Wednesday priced Samsung Electronic's 005930.KS touchscreen Instinct phone, a rival of Motorola and of Apple Inc's AAPL.O iPhone at a competitive $130, after rebate, and said it would spend more than $100 million to market the product.
"This sort of solidifies what shape they are in," said Canaccord Adams analyst Peter Misek. Samsung, LG Electronics 066570.KS, Blackberry maker Research in Motion RIM.TO and Apple are stealing share at Motorola and Nokia's NOK1V.HE expense, he said. "MOT is the much weaker player."
In addition, handset maker Foxconn International Holdings Ltd 2038.HK, a Hong Kong firm that makes phones for Motorola and others, also told Bloomberg that Motorola was still "having difficulties". Foxconn, a division of Taiwan's Hon Hai Precision Industry Co Ltd 2317.TW expected its profitability to come under pressure this year due to competition.
“That is putting pressure on some of the mobile phone manufacturers like Nokia and Motorola,” said William Lefkowitz, options strategist at brokerage firm vFinance Investments in New York.
Shares of Motorola were down 6.7 percent to $8.02 and touched a low of $7.61, Nokia was down 3.4 percent to $24.54, Apple was up 1.3 percent at $181.20, RIM was up 1 percent to $146.15 on Nasdaq. Samsung shares closed down 4 percent and LG dropped 5.5 percent.
Reporting by Peter Henderson and Doris Frankel
Our Standards: The Thomson Reuters Trust Principles.