Slowdown at Motorola

Soft sales of the Razr phone take their toll.
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Motorola (MOT) continues to lose steam, despite the normally heated holiday sales season for new cell phones.

The Schaumburg, Ill., mobile-phone giant was slapped with a downgrade to neutral Tuesday from Cowen Research analyst Matt Hoffman over concerns about slow December sales.

"Motorola's new products are off to a slow start, our latest checks point to an Americas market that has softened significantly since our November update," Hoffman writes in a research note.

The problem is that Motorola isn't doing anything to meet the public's craving for the latest new thing. The company hasn't produced a new phone model to succeed the hugely popular ultrathin Razr.

To some degree, the issue of soft holiday sales should come as no surprise. In October, the company reported

surprisingly weak sales for the third quarter.

Analysts have noted recently that Motorola's winning streak is in jeopardy.

"The Motorola line-up is losing its magical appeal from the last year or two," Albert Lin wrote in a research report last month.

Motorola had high hopes for its Krzr -- pronounced "Krazor." But industry analysts and trend spotters called it a nothing more than a repackaged Razr. Prices on the Krzr have dropped from $300 to $150 in a matter of weeks, never a good sign for a presumably hot product introduction.

The Krzr is widely available in Europe, but "the ramp looks more muted than initially anticipated," writes Hoffman, who cut his Krzr sales estimates to 2 million units from about 3.5 million previously targeted.

With Motorola's new star fading already and nothing brilliant going on in the rest of its product lineup, the fourth quarter looks a little dim, Hoffman writes.

Motorola's U.S. telcos customers, namely

Cingular

, a joint venture between

AT&T

(T) - Get Report

and

BellSouth

,

(BLS)

and

T-Mobile

, a unit of

Deutsche Telekom

(DT) - Get Report

, "have become concerned about excessive inventory levels," Hoffman writes.

Motorola shares fell 20 cents to $20.56 in midmorning trading Tuesday. The stock has now fallen 21% since its high of $25.20 in October.