First Call consensus expected Motorola to report a loss of 4 cents a share in the quarter. But that estimate was watered down considerably after the company warned of slower demand in Asia. The $7bn in sales represents a 7 percent decline from the $7.5bn (£4.57bn) reported in the year-ago quarter when it earned $268m (£163m), or 44 cents a share. Analysts had predicted that Motorola would report its first quarter in the red in more than 13 years. Though company officials weren't tickled about the second-quarter results, staying in positive territory was viewed as a significant victory in light of the ongoing Asian economic crisis. "As we indicated last month, the second-quarter results reflect further slowing of demand and continuing global pricing pressure, principally in the semiconductor products and messaging, information and media segments and driven primarily by economic conditions in Asia," said chief executive Robert Growney in a prepared release. "The goal of our renewal plan is to generate annualised savings, once all actions have been implemented over the next 12 months, of more than $750m (£457m). "We expect to see the positive impact of these savings to steadily increase over the next several quarters." Analysts look to Motorola as a key technology bellwether, especially since it does so much business in Asia. Last week, Motorola officials warned of an impending loss because the semiconductor market would be "significantly" lower due to pricing pressures and the Asian economic crisis. Last quarter, it earned $180m (£109m), or 30 cents a share, on sales of $6.88bn (£4.2bn). "Motorola is not only fighting Asia but some serious competition from Lucent Technologies and Ericsson," said Bruce Carlsmith, an analyst at NationsBanc Montgomery Securities. Even though Motorola squeaked out a slight profit in the quarter, company officials warned that "continuing uncertainty" throughout Asia and the semiconductor industry would likely crimp sales and earnings through the second half of 1998. The $6m (£3.66m) profit excluded a special one-time charge of $1.91bn (£1.16bn), or $2.23 a share, associated with a series manufacturing consolidations, cost reductions and restructuring charges. Including the charges, Motorola actually lost $1.3 bn (£793m), or $2.22 a share, in the quarter. In the quarter, semiconductor sales fell 11 percent to $1.81bn (£1.1bn) and orders were down 25 percent. However, sales of local-area-network equipment improved 18 percent to $1.37bn (£835m) in the quarter. Sales from the messaging, information and media segment fell 32 percent to $771m (£470m) and orders were off by 35 percent versus the year-ago quarter. Eighteen of the 33 institutional investment firms following the stock maintain a "hold" recommendation. Motorola shares hit a 52-week high of 90 ½ last July before falling to a low of 48 9/16 in June.