Updated from 8:31 a.m. EDT

Shares of Motorola ( MOT) sank Thursday after the handset maker swung to a third-quarter loss, guided lower for the year and announced it would delay the separation of its mobile phone business.

The struggling Schaumburg, Ill., tech giant swung to a loss of $397 million, or 18 cents a share, in the third quarter, compared with a profit of $60 million, or 3 cents a share, in the year-ago period. Excluding one-time items, Motorola had a profit of 5 cents a share.

Sales for the first quarter were $7.48 billion, down 15% from a year earlier. Gross margin declined to 24.1% from 28.8% a year ago and 28.4% sequentially.

On average, analysts expected a profit of 2 cents a share on sales of $7.82 billion in the quarter, according to Thomson Reuters.

Motorola said mobile-device sales in the quarter were $3.1 billion, down 31% from last year and down slightly from the previous quarter. The division had an operating loss of $840 million in the quarter, compared to a loss of $248 million a year ago. The number of units shipped was 25.4 million, down from 28.1 million in the second quarter.

Performance in Motorola's other segments failed to offset weakness in the handset division. Motorola's home and networks mobility segment sales were $2.4 billion, down 1% from the year-ago quarter. The enterprise mobility segment saw sales rise 4% from a year earlier to $2 billion, although that figure was flat sequentially.

Looking ahead, Motorola expects earnings in the fourth quarter in a range 2 cents to 4 cents a share, before items. For the full year, it now expects to book a profit of 5 cents a share to 7 cents a share, down slightly from its previous forecast. The Thomson Reuters average estimate is for a profit of 7 cents a share in the fourth quarter and 6 cents a share for the full year.

The company said it would also delay the split of its operations into two separate publicly traded companies. On March 26, the company announced it would seek to splinter off its troubled handset unit. Earlier this week, the company said it will split its home and networks mobility segment into three new units, which will be broadband home solutions, broadband access solutions, and cellular networks.

"While our strategic intent to separate the company remains intact, we are no longer targeting the third quarter of 2009, primarily due to the macroeconomic environment, stresses in the financial markets and the changes underway in Mobile Devices," said Co-CEO Sanjay Jha.

The Wall Street Journal reported Thursday afternoon that Motorola would also cut its workforce by 3,000 jobs. Co-CEO Greg Brown said two-thirds of the cuts will come from the mobile devices segment. The layoffs and other moves will save the company $800 million next year, Brown said.

The earnings release comes one day after media reports that said Motorola is moving quickly to scale back its struggling cell phone division, simplifying the way it makes devices and cutting additional jobs.

Jha, who defected from Qualcomm ( QCOM) to head up the wireless unit in August, is spearheading the process, according to reports.

On its conference call, Motorola said it will begin using Google's ( GOOG) Android operating platform and Microsoft's ( MSFT) Windows Mobile platform on its high-end handsets, with the first Android set to ship in the 2009 holiday season.

Shares of Motorola fell 5.3% to $5.17. Competing phone maker Nokia ( NOK) was up 5.8%, Ericsson ( ERIC) added 3.1% and Qualcomm rose 4.8%.

Among smart phone makers, Research In Motion ( RIMM) slipped 0.9%, while Apple ( AAPL) gained 6.2%.