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Motorola Jumps on Sunny Outlook

Motorola reports solid third-quarter results and offers a positive outlook based on cost cuts and expectations for its Android phone.

SHAUMBURG, Ill. -- (


) --



delivered solid third-quarter numbers and an upbeat profit forecast based on cost cuts and the predicted success of its new


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Android-powered phones.

The wireless tech shop posted adjusted earnings of 2 cents a share, which exclude a one-time charge. This small profit is a big improvement from the 18-cent loss in the year-ago period, and it beat the breakeven target that analysts expected, according to Yahoo! Finance.

Sales for the third quarter ended last month were $5.45 billion, a 27% decline from the $7.5 billion level last year and slightly below the $5.54 billion analysts were looking for.

Droid Is Here: First Look

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Looking ahead, the company expects adjusted earnings to be within the 7 cent and 9-cent range. The 8-cent midpoint is above the 6 cents analysts were expecting.

Motorola unveiled its Droid phone for


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, the nation's largest wireless telco. The phone uses the most recent version of Google's Android software and has made

favorable impressions in early reviews

. Wireless chief Sanjay Jha has aligned Motorola's phone unit turnaround strategy on the Android operating system. The bold bet on a still emerging software has shown some promise as Android becomes more widely accepted.

The Droid smartphone.

Jha said Wednesday during a Droid press conference that Motorola would have more than 20 smartphones next year, with the majority of those phones running on Android.

"The introductions of our new products powered by Android are important milestones as we begin to address the mobilization of the Internet and the growing demand for modern smartphones," Jha said in a press release. "Next year, we will continue to expand our smartphone portfolio and deliver improved financial results."

Motorola says it had cut 9,700 employees since 2008 in an effort to reduce costs in tandem with the company's declining revenue levels. In the phone unit, the operating loss was $183 million down from $238 million in the second quarter and below the $296 million a year ago.

Motorola still faces intense competition from


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iPhone, several new BlackBerries from

Research In Motion


and new phones from





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. Adding to the pressure, Google is expected to

start selling its own Android phone

as early as this year.

Shares of Motorola jumped 55 cents, or 7%, to $8.51 in premarket trading Thursday.

-- Reported by Scott Moritz in New York