8-K

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 8, 2003

Motorola, Inc.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation)

1-7221
(Commission File Number)

36-1115800
(I.R.S. Employer Identification No.)

1303 East Algonquin Road, Schaumburg, Illinois 60196
(Address of principal executive offices)

Registrant's telephone number, including area code: (847) 576-5000

Not applicable
(Former name or former address, if changed since last report.)

Explanatory Note:

•

This Form 8-K reflects the reclassification of 2002 and 2001 royalty income and certain expense items with no impact on historical GAAP operating earnings (loss), net earnings (loss) or earnings (loss) per share.



•

Royalty income and certain expense items are reclassified between Net sales; Costs of sales; Selling, general and administrative expenses; and Research and development expenditures in order to conform with Motorola's new 2003 presentation format.

Item 12.    Results of Operation and Financial Condition

The information in this Form 8-K is furnished under "Item 12. Results of Operations and Financial Condition" in accordance with SEC Release No. 33-8216. The information in this Form 8-K and the Exhibits attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Executive Summary:    Beginning in the first quarter of 2003, Motorola will be making changes in the presentation format of its financial statements in order to align more closely with the financial statement presentation of other technology companies. In doing so, Motorola will reclassify royalty income and certain expense items between the following lines in its Consolidated Statements of Operations: Net sales; Costs of sales; Selling, general and administrative (SG&A) expenses; and Research and development (R&D) expenditures. As a result, certain reclassifications have been made to previously reported quarterly and annual financial information for 2002 and 2001 so the statement lines are comparable to the 2003 presentation.

These reclassifications do not change the Company's historical GAAP operating earnings (loss), net earnings (loss) or earnings (loss) per share. This Form 8-K is being furnished to assist investors in making accurate comparisons of the Company's historical 2002 and 2001 financial information with future financial information.

Detailed Explanation:    Beginning in the first quarter of 2003, Motorola will reclasify royalty income and certain expense items between certain lines in its Consolidated Statements of Operations. As a result, certain reclassifications have been made to previously reported quarterly and annual financial information for 2002 and 2001 so the statement lines are comparable to the 2003 presentation. These reclassifications are reflected in the financial statements that are attached to this Form 8-K as Exhibit 99.1. The following paragraphs describe these reclassifications.

Reclassification of Income/Expense Items between Statement Lines:

Royalty Income:    Royalty income will be included in Net sales and will no longer be included as an offset to SG&A expenses. Costs incurred in generating royalty income will be included in Costs of sales and will no longer be included in SG&A expenses.

Fringe Benefits:    Certain employee fringe benefit costs for direct labor employees and employees in R&D functions will be included in Costs of sales and R&D expenditures, respectively, and will no longer be included in SG&A expenses.

Production Planning Costs:    Certain costs associated with production planning activities will be included in Costs of sales and will no longer be included in SG&A expenses.

Engineering Support for Production Activities:    Certain costs associated with providing engineering support for production activities will be included in Costs of Sales and will no longer be included in R&D expenditures.

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As a result of the reclassifications discussed above, GAAP results in the historical Consolidated Statements of Operations were impacted as follows:

For 2002:

Net sales increased $600 million, from $26.7 billion to $27.3 billion
Costs of sales increased $369 million, from $17.9 billion to $18.3 billion
SG&A expenses increased $269 million, from $4.2 billion to $4.5 billion
R&D expenditures decreased $38 million, from $3.8 billion to $3.7 billion
Operating loss is unchanged at ($1.8) billion
Net loss is unchanged at ($2.5) billion
Diluted loss per common share is unchanged at $(1.09) per share

For 2001:

Net sales increased $613 million, from $29.9 billion to $30.5 billion
Costs of sales increased $460 million, from $22.7 billion to $23.1 billion
SG&A expenses increased $196 million, from $4.7 billion to $4.9 billion
R&D expenditures decreased $43 million, from $4.3 billion to $4.3 billion
Operating loss is unchanged at ($5.8) billion
Net loss is unchanged at ($3.9) billion
Diluted loss per common share is unchanged at $(1.78) per share

Adjustments to Historical Orders for Motorola's Segments:    In connection with the reclassification of royalty income to Net Sales, the Company will also include royalty income in its periodic measurements of Orders for the Company's operating segments. As a result, certain adjustments have been made to previously reported segment Orders for 2002 and 2001 so the historical Orders are comparable to the 2003 presentation. These adjusted segment Orders are reflected in Exhibit 99.2 to this Form 8-K.

Amortization of Acquired Intangibles Not to be Treated as a "Special Item":    Motorola has periodically provided financial information relating to certain "special items" that impact the operating results of the Company and its operating segments. Historically, the amortization of acquired intangibles was included as a special item. Due to the discontinuance of goodwill amortization in 2002, effective January 1, 2003, Motorola will no longer include amortization of acquired intangibles as a special item for either the Company or any of its operating segments. Accordingly, the reclassified Consolidated Statements of Operations for the four quarters and full years 2002 and 2001 that are attached to this Form 8-K as part of Exhibit 99.1 no longer include expenses associated with amortization of acquired intangibles under the column entitled "Special Items". As a result, special items associated with SG&A expenses, as reflected in the reclassified Consolidated Statements of Operations are reduced by $56 million in 2002 and are reduced by $40 million in 2001. The majority of the expenses for amortization of acquired intangibles in 2002 and 2001 were in the Company's Broadband Communications segment, which had expenses of $38 million in 2002 and $16 million in 2001. The Special Items Description that is included in Exhibit 99.1 also excludes the expenses associated with amortization of acquired intangibles and, accordingly, does not include the $56 million in expenses for 2002 or the $40 million in expenses for 2001 described above. Supplemental information relating to this change in treatment of expenses for amortization of acquired intangibles, including reclassified financial statements of Segment Operating Earnings (Loss) and tables of segment Special Items Description can be found on Motorola's website at www.motorola.com/investor.

This Form 8-K is being furnished to assist investors in making accurate comparisons of the Company's historical 2002 and 2001 financial information, as presented in the Consolidated Statements of Operations and related Segment Information tables, with future financial information. In addition to GAAP results, the reclassified Consolidated Statements of Operations reflect non-GAAP measurements of Motorola's results of operations, which are presented on a basis excluding special items and certain exited businesses. The reclassified Segment Information tables are presented on a basis excluding certain exited businesses. Investors and management use these ongoing results of operations, excluding special

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items, to measure Motorola's current and future financial performance. The non-GAAP measurements do not replace the presentation of Motorola's GAAP financial results. These measurements provide supplemental information to assist investors in analyzing Motorola's financial position and results of operations. Motorola has chosen to provide this information to investors to enable them to perform meaningful comparisons of past, present and future operating results and as a means to emphasize the results of core on-going operations. Special items include employee severance costs, fixed asset impairments, litigation-related charges, investment impairments, goodwill/intangible asset impairments, in-process research and development charges, other unusual charges and gains on sales of investments and businesses.

Exhibit 99.1, which is attached hereto, contains the following reclassified financial information for the four quarters and full years of 2002 and 2001: (i) Consolidated Statements of Operations reflecting GAAP results with a reconciliation to ongoing operations excluding special items; (ii) Segment Information tables reflecting GAAP results with a reconciliation to ongoing operations, and (iii) Special Items Description tables.

Exhibit 99.2, which is attached hereto, contains adjusted Orders for each of Motorola's operating segments for the four quarters and full years of 2002 and 2001.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MOTOROLA, INC.
Dated: April 7, 2003	By:	/s/ Anthony Knapp Anthony Knapp Senior Vice President and Controller

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EXHIBIT INDEX

Exhibit No.	Document
99.1	Reclassified Consolidated Statements of Operations, Segment Information and Special Items Description for: (i) the quarters ended March 30, June 29, September 28 and December 31, 2002, (ii) the quarters ended March 31, June 30, September 29 and December 31, 2001, and (iii) the years ended December 31, 2002 and 2001.
99.2	Adjusted Segment Orders for: (i) the quarters ended March 30, June 29, September 28 and December 31, 2002, (ii) the quarters ended March 31, June 30, September 29 and December 31, 2001, and (iii) the years ended December 31, 2002 and 2001.

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SIGNATURES
EXHIBIT INDEX

EX-99.1

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Exhibit 99.1

Motorola, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amounts)

		For the Quarter Ended March 30, 2002
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)		Ongoing Operations Excluding Special Items
Net sales		$	6,181		$	—		$	6,181		$	—	$	6,181
Costs of sales			4,328			(8	)		4,320			—		4,320
Gross margin			1,853			(8	)		1,861			—		1,861
Selling, general and administrative expenses			1,108			12			1,120			—		1,120
Research and development expenditures			906			—			906			—		906
Reorganization of businesses			198			(198	)		—			—		—
Other charges			3			(3	)		—			—		—
Operating loss			(362	)		(197	)		(165	)		—		(165	)
Other income/(expense):
	Interest expense, net		(108	)		—			(108	)		—		(108	)
	Gains on sales of investments and businesses, net		11			11			—			—		—
	Other		(192	)		(188	)		(4	)		—		(4	)
Total other income/ (expense)			(289	)		(177	)		(112	)		—		(112	)
Loss before income taxes			(651	)		(374	)		(277	)		—		(277	)
Income tax provision			(202	)		109			(93	)		—		(93	)
Net loss		$	(449	)	$	(265	)	$	(184	)	$	—	$	(184	)
Net loss per common share
	Basic	$	(0.20	)									$	(0.08	)
	Diluted	$	(0.20	)									$	(0.08	)
Weighted average common shares outstanding
	Basic		2,253.5											2,253.5
	Diluted		2,253.5											2,253.5
Dividends paid per share		$	0.04										$	0.04

		For the Quarter Ended March 31, 2001
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)			Ongoing Operations Excluding Special Items
Net sales		$	7,799		$	—		$	7,799		$	197		$	7,602
Costs of sales			6,197			(524	)		5,673			(135	)		5,538
Gross margin			1,602			(524	)		2,126			62			2,064
Selling, general and administrative expenses			1,234			(18	)		1,216			(42	)		1,174
Research and development expenditures			1,161			—			1,161			(11	)		1,150
Reorganization of businesses			241			(241	)		—			—			—
Other charges			72			(72	)		—			—			—
Operating earnings (loss)			(1,106	)		(855	)		(251	)		9			(260	)
Other income/(expense):
	Interest expense, net		(61	)		—			(61	)		(2	)		(59	)
	Gains on sales of investments and businesses, net		614			614			—			—			—
	Other		(38	)		(29	)		(9	)		—			(9	)
Total other income/ (expense)			515			585			(70	)		(2	)		(68	)
Earnings (loss) before income taxes			(591	)		(270	)		(321	)		7			(328	)
Income tax provision			(58	)		(49	)		(107	)		(2	)		(109	)
Net earnings (loss)		$	(533	)	$	(319	)	$	(214	)	$	5		$	(219	)
Net loss per common share
	Basic	$	(0.24	)										$	(0.10	)
	Diluted	$	(0.24	)										$	(0.10	)
Weighted average common shares outstanding
	Basic		2,194.0												2,194.0
	Diluted		2,194.0												2,194.0
Dividends paid per share		$	0.04											$	0.04

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Motorola, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amounts)

		For the Quarter Ended June 29, 2002
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)		Ongoing Operations Excluding Special Items
Net sales		$	6,869		$	—		$	6,869		$	—	$	6,869
Costs of sales			4,629			(40	)		4,589			—		4,589
Gross margin			2,240			(40	)		2,280			—		2,280
Selling, general and administrative expenses			1,177			—			1,177			—		1,177
Research and development expenditures			925			—			925			—		925
Reorganization of businesses			1,468			(1,468	)		—			—		—
Other charges			909			(909	)		—			—		—
Operating earnings (loss)			(2,239	)		(2,417	)		178			—		178
Other income/(expense):
	Interest expense, net		(100	)		—			(100	)		—		(100	)
	Gains on sales of investments and businesses, net		24			24			—			—		—
	Other		(975	)		(955	)		(20	)		—		(20	)
Total other income/ (expense)			(1,051	)		(931	)		(120	)		—		(120	)
Earnings (loss) before income taxes			(3,290	)		(3,348	)		58			—		58
Income tax provision			(969	)		988			19			—		19
Net earnings (loss)		$	(2,321	)	$	(2,360	)	$	39		$	—	$	39
Net earnings (loss) per common share
	Basic	$	(1.02	)									$	0.02
	Diluted	$	(1.02	)									$	0.02
Weighted average common shares outstanding
	Basic		2,277.2											2,277.2
	Diluted		2,277.2											2,277.2
Dividends paid per share		$	0.04										$	0.04

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		For the Quarter Ended June 30, 2001
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)			Ongoing Operations Excluding Special Items
Net sales		$	7,697		$	—		$	7,697		$	194		$	7,503
Costs of sales			5,895			(307	)		5,588			(135	)		5,453
Gross margin			1,802			(307	)		2,109			59			2,050
Selling, general and administrative expenses			1,301			(9	)		1,292			(37	)		1,255
Research and development expenditures			1,080			—			1,080			(11	)		1,069
Reorganization of businesses			619			(619	)		—			—			—
Other charges			99			(99	)		—			—			—
Operating earnings (loss)			(1,297	)		(1,034	)		(263	)		11			(274	)
Other income/(expense):
	Interest expense, net		(104	)		—			(104	)		(2	)		(102	)
	Gains on sales of investments and businesses, net		742			742			—			—			—
	Other		(189	)		(194	)		5			—			5
Total other income/ (expense)			449			548			(99	)		(2	)		(97	)
Earnings (loss) before income taxes			(848	)		(486	)		(362	)		9			(371	)
Income tax provision			(89	)		(32	)		(121	)		(3	)		(124	)
Net earnings (loss)		$	(759	)	$	(518	)	$	(241	)	$	6		$	(247	)
Net loss per common share
	Basic	$	(0.35	)										$	(0.11	)
	Diluted	$	(0.35	)										$	(0.11	)
Weighted average common shares outstanding
	Basic		2,202.9												2,202.9
	Diluted		2,202.9												2,202.9
Dividends paid per share		$	0.04											$	0.04

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Motorola, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amounts)

		For the Quarter Ended September 28, 2002
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)		Ongoing Operations Excluding Special Items
Net sales		$	6,532		$	—		$	6,532		$	—	$	6,532
Costs of sales			4,212			(20	)		4,192			—		4,192
Gross margin			2,320			(20	)		2,340			—		2,340
Selling, general and administrative expenses			1,105			—			1,105			—		1,105
Research and development expenditures			948			—			948			—		948
Reorganization of businesses			11			(11	)		—			—		—
Other charges			(85	)		85			—			—		—
Operating earnings			341			54			287			—		287
Other income/(expense):
	Interest expense, net		(92	)		—			(92	)		—		(92	)
	Gains on sales of investments and businesses, net		37			37			—			—		—
	Other		(71	)		(77	)		6			—		6
Total other income/ (expense)			(126	)		(40	)		(86	)		—		(86	)
Earnings before income taxes			215			14			201			—		201
Income tax provision			104			(36	)		68			—		68
Net earnings (loss)		$	111		$	(22	)	$	133		$	—	$	133
Net earnings per common share
	Basic	$	0.05										$	0.06
	Diluted	$	0.05										$	0.06
Weighted average common shares outstanding
	Basic		2,295.8											2,295.8
	Diluted		2,308.2											2,308.2
Dividends paid per share		$	0.04										$	0.04

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		For the Quarter Ended September 29, 2001
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)			Ongoing Operations Excluding Special Items
Net sales		$	7,522		$	—		$	7,522		$	162		$	7,360
Costs of sales			5,578			(98	)		5,480			(117	)		5,363
Gross margin			1,944			(98	)		2,042			45			1,997
Selling, general and administrative expenses			1,160			(27	)		1,133			(28	)		1,105
Research and development expenditures			1,026			—			1,026			(8	)		1,018
Reorganization of businesses			133			(133	)		—			—			—
Other charges			1,408			(1,408	)		—			—			—
Operating earnings (loss)			(1,783	)		(1,666	)		(117	)		9			(126	)
Other income/(expense):
	Interest expense, net		(140	)		(22	)		(118	)		(2	)		(116	)
	Gains on sales of investments and businesses, net		542			542			—			—			—
	Other		(838	)		(830	)		(8	)		—			(8	)
Total other income/ (expense)			(436	)		(310	)		(126	)		(2	)		(124	)
Earnings (loss) before income taxes			(2,219	)		(1,976	)		(243	)		7			(250	)
Income tax provision			(811	)		732			(79	)		(2	)		(81	)
Net earnings (loss)		$	(1,408	)	$	(1,244	)	$	(164	)	$	5		$	(169	)
Net loss per common share
	Basic	$	(0.64	)										$	(0.08	)
	Diluted	$	(0.64	)										$	(0.08	)
Weighted average common shares outstanding
	Basic		2,217.1												2,217.1
	Diluted		2,217.1												2,217.1
Dividends paid per share		$	0.04											$	0.04

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Motorola, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amounts)

		For the Quarter Ended December 31, 2002
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)		Ongoing Operations Excluding Special Items
Net sales		$	7,697		$	—		$	7,697		$	—	$	7,697
Costs of sales			5,138			12			5,150			—		5,150
Gross margin			2,559			12			2,547			—		2,547
Selling, general and administrative expenses			1,082			—			1,082			—		1,082
Research and development expenditures			937			—			937			—		937
Reorganization of businesses			87			(87	)		—			—		—
Other charges			6			(6	)		—			—		—
Operating earnings (loss)			447			(81	)		528			—		528
Other income/(expense):
Interest expense, net			(56	)		—			(56	)		—		(56	)
Gains on sales of investments and businesses, net			24			24			—			—		—
Other			(135	)		(131	)		(4	)		—		(4	)
Total other income/ (expense)			(167	)		(107	)		(60	)		—		(60	)
Earnings (loss) before income taxes			280			(188	)		468			—		468
Income tax provision			106			71			177			—		177
Net earnings (loss)		$	174		$	(117	)	$	291		$	—	$	291
Net earnings per common share
	Basic	$	0.08										$	0.13
	Diluted	$	0.08										$	0.13
Weighted average common shares outstanding
	Basic		2,305.5											2,305.5
	Diluted		2,322.0											2,322.0
Dividends paid per share		$	0.04										$	0.04

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		For the Quarter Ended December 31, 2001
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)		Ongoing Operations Excluding Special Items
Net sales		$	7,468		$	—		$	7,468		$	—	$	7,468
Costs of sales			5,451			(152	)		5,299			—		5,299
Gross margin			2,017			(152	)		2,169			—		2,169
Selling, general and administrative expenses			1,224			(31	)		1,193			—		1,193
Research and development expenditures			1,008			—			1,008			—		1,008
Reorganization of businesses			865			(865	)		—			—		—
Other charges			537			(537	)		—			—		—
Operating loss			(1,617	)		(1,585	)		(32	)		—		(32	)
Other income/(expense):
	Interest expense, net		(108	)		—			(108	)		—		(108	)
	Gains on sales of investments and businesses, net		33			33			—			—		—
	Other		(161	)		(159	)		(2	)		—		(2	)
Total other income/ (expense)			(236	)		(126	)		(110	)		—		(110	)
Loss before income taxes			(1,853	)		(1,711	)		(142	)		—		(142	)
Income tax provision			(616	)		572			(44	)		—		(44	)
Net loss		$	(1,237	)	$	(1,139	)	$	(98	)	$	—	$	(98	)
Net loss per common share
	Basic	$	(0.55	)									$	(0.04	)
	Diluted	$	(0.55	)									$	(0.04	)
Weighted average common shares outstanding
	Basic		2,236.8											2,236.8
	Diluted		2,236.8											2,236.8
Dividends paid per share		$	0.04										$	0.04

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Motorola, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amounts)

		For the Year Ended December 31, 2002
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)		Ongoing Operations Excluding Special Items
Net sales		$	27,279		$	—		$	27,279		$	—	$	27,279
Costs of sales			18,307			(56	)		18,251			—		18,251
Gross margin			8,972			(56	)		9,028			—		9,028
Selling, general and administrative expenses			4,472			12			4,484			—		4,484
Research and development expenditures			3,716			—			3,716			—		3,716
Reorganization of businesses			1,764			(1,764	)		—			—		—
Other charges			833			(833	)		—			—		—
Operating earnings (loss)			(1,813	)		(2,641	)		828			—		828
Other income/(expense):
	Interest expense, net		(356	)		—			(356	)		—		(356	)
	Gains on sales of investments and businesses, net		96			96			—			—		—
	Other		(1,373	)		(1,351	)		(22	)		—		(22	)
Total other income/ (expense)			(1,633	)		(1,255	)		(378	)		—		(378	)
Earnings (loss) before income taxes			(3,446	)		(3,896	)		450			—		450
Income tax provision			(961	)		1,132			171			—		171
Net earnings (loss)		$	(2,485	)	$	(2,764	)	$	279		$	—	$	279
Net earnings (loss) per common share
	Basic	$	(1.09	)									$	0.12
	Diluted	$	(1.09	)									$	0.12
Weighted average common shares outstanding
	Basic		2,282.3											2,282.3
	Diluted		2,282.3											2,282.3
Dividends paid per share		$	0.16										$	0.16

9

		For the Year Ended December 31, 2001
		GAAP Results			Special Items Inc/(Exp)			Excluding Special Items			Exited Businesses Inc/(Exp)			Ongoing Operations Excluding Special Items
Net sales		$	30,486		$	—		$	30,486		$	553		$	29,933
Costs of sales			23,121			(1,081	)		22,040			(387	)		21,653
Gross margin			7,365			(1,081	)		8,446			166			8,280
Selling, general and administrative expenses			4,919			(85	)		4,834			(107	)		4,727
Research and development expenditures			4,275			—			4,275			(30	)		4,245
Reorganization of businesses			1,858			(1,858	)		—			—			—
Other charges			2,116			(2,116	)		—			—			—
Operating earnings (loss)			(5,803	)		(5,140	)		(663	)		29			(692	)
Other income/(expense):
	Interest expense, net		(413	)		(22	)		(391	)		(6	)		(385	)
	Gains on sales of investments and businesses, net		1,931			1,931			—			—			—
	Other		(1,226	)		(1,212	)		(14	)		—			(14	)
Total other income/ (expense)			292			697			(405	)		(6	)		(399	)
Earnings (loss) before income taxes			(5,511	)		(4,443	)		(1,068	)		23			(1,091	)
Income tax provision			(1,574	)		1,223			(351	)		(7	)		(358	)
Net earnings (loss)		$	(3,937	)	$	(3,220	)	$	(717	)	$	16		$	(733	)
Net loss per common share
	Basic	$	(1.78	)										$	(0.33	)
	Diluted	$	(1.78	)										$	(0.33	)
Weighted average common shares outstanding
	Basic		2,213.3												2,213.3
	Diluted		2,213.3												2,213.3
Dividends paid per share		$	0.16											$	0.16

10

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)

        Summarized below are the Company's net sales by reportable segment for the quarters ended March 30, 2002 and March 31, 2001.

		For the Quarter Ended March 30, 2002
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations			% Change from 2001
Personal Communications Segment		$	2,406		$	—	$	2,406		3	%
Semiconductor Products Segment			1,127			—		1,127		-26	%
Global Telecom Solutions Segment			1,085			—		1,085		-36	%
Commercial, Govt, and Industrial Solutions Segment			802			—		802		-10	%
Broadband Communications Segment			525			—		525		-36	%
Integrated Electronic Systems Segment			509			—		509		-20	%
Other Products Segment			107			—		107		-47	%
Adjustments & Eliminations			(380	)		—		(380	)	-22	%
	Segment Totals	$	6,181		$	—	$	6,181		-19	%

		For the Quarter Ended March 31, 2001
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations
Personal Communications Segment		$	2,336		$	—	$	2,336
Semiconductor Products Segment			1,517			—		1,517
Global Telecom Solutions Segment			1,685			—		1,685
Commercial, Govt, and Industrial Solutions Segment			1,048			154		894
Broadband Communications Segment			818			—		818
Integrated Electronic Systems Segment			637			—		637
Other Products Segment			245			43		202
Adjustments & Eliminations			(487	)		—		(487	)
	Segment Totals	$	7,799		$	197	$	7,602

11

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)

        Summarized below are the Company's net sales by reportable segment for the quarters ended June 29, 2002 and June 30, 2001.

		For the Quarter Ended June 29, 2002
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations			% Change from 2001
Personal Communications Segment		$	2,684		$	—	$	2,684		3	%
Semiconductor Products Segment			1,256			—		1,256		-3	%
Global Telecom Solutions Segment			1,262			—		1,262		-24	%
Commercial, Govt, and Industrial Solutions Segment			889			—		889		1	%
Broadband Communications Segment			554			—		554		-35	%
Integrated Electronic Systems Segment			566			—		566		3	%
Other Products Segment			129			—		129		-40	%
Adjustments & Eliminations			(471	)		—		(471	)	-16	%
	Segment Totals	$	6,869		$	—	$	6,869		-8	%

		For the Quarter Ended June 30, 2001
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations
Personal Communications Segment		$	2,604		$	—	$	2,604
Semiconductor Products Segment			1,295			—		1,295
Global Telecom Solutions Segment			1,669			—		1,669
Commercial, Govt, and Industrial Solutions Segment			1,042			161		881
Broadband Communications Segment			851			—		851
Integrated Electronic Systems Segment			549			—		549
Other Products Segment			248			33		215
Adjustments & Eliminations			(561	)		—		(561	)
	Segment Totals	$	7,697		$	194	$	7,503

12

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)

        Summarized below are the Company's net sales by reportable segment for the quarters ended September 28, 2002 and September 29, 2001.

		For the Quarter Ended September 28, 2002
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations			% Change from 2001
Personal Communications Segment		$	2,715		$	—	$	2,715		-2	%
Semiconductor Products Segment			1,275			—		1,275		15	%
Global Telecom Solutions Segment			1,029			—		1,029		-42	%
Commercial, Govt, and Industrial Solutions Segment			884			—		884		-1	%
Broadband Communications Segment			519			—		519		-19	%
Integrated Electronic Systems Segment			544			—		544		6	%
Other Products Segment			120			—		120		1	%
Adjustments & Eliminations			(554	)		—		(554	)	21	%
	Segment Totals	$	6,532		$	—	$	6,532		-11	%

		For the Quarter Ended September 29, 2001
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations
Personal Communications Segment		$	2,775		$	—	$	2,775
Semiconductor Products Segment			1,111			—		1,111
Global Telecom Solutions Segment			1,772			—		1,772
Commercial, Govt, and Industrial Solutions Segment			1,031			141		890
Broadband Communications Segment			637			—		637
Integrated Electronic Systems Segment			513			—		513
Other Products Segment			140			21		119
Adjustments & Eliminations			(457	)		—		(457	)
	Segment Totals	$	7,522		$	162	$	7,360

13

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)

        Summarized below are the Company's net sales by reportable segment for the quarters ended December 31, 2002 and December 31, 2001.

		For the Quarter Ended December 31, 2002
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations			% Change from 2001
Personal Communications Segment		$	3,369		$	—	$	3,369		10.4	%
Semiconductor Products Segment			1,342			—		1,342		14.2	%
Global Telecom Solutions Segment			1,235			—		1,235		-11.0	%
Commercial, Govt, and Industrial Solutions Segment			1,174			—		1,174		-2.2	%
Broadband Communications Segment			489			—		489		-15.5	%
Integrated Electronic Systems Segment			570			—		570		5.6	%
Other Products Segment			130			—		130		6.6	%
Adjustments & Eliminations			(612	)		—		(612	)	3.7	%
	Segment Totals	$	7,697		$	—	$	7,697		3.1	%

		For the Quarter Ended December 31, 2001
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations
Personal Communications Segment		$	3,053		$	—	$	3,053
Semiconductor Products Segment			1,175			—		1,175
Global Telecom Solutions Segment			1,388			—		1,388
Commercial, Govt, and Industrial Solutions Segment			1,201			—		1,201
Broadband Communications Segment			579			—		579
Integrated Electronic Systems Segment			540			—		540
Other Products Segment			122			—		122
Adjustments & Eliminations			(590	)		—		(590	)
	Segment Totals	$	7,468		$	—	$	7,468

14

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)

        Summarized below are the Company's net sales by reportable segment for the years ended December 31, 2002 and December 31, 2001.

		For the Year Ended December 31, 2002
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations			% Change from 2001
Personal Communications Segment		$	11,174		$	—	$	11,174		4	%
Semiconductor Products Segment			5,000			—		5,000		-2	%
Global Telecom Solutions Segment			4,611			—		4,611		-29	%
Commercial, Govt, and Industrial
	Solutions Segment		3,749			—		3,749		-3	%
Broadband Communications Segment			2,087			—		2,087		-28	%
Integrated Electronic Systems Segment			2,189			—		2,189		-2	%
Other Products Segment			486			—		486		-26	%
Adjustments & Eliminations			(2,017	)		—		(2,017	)	-4	%
	Segment Totals	$	27,279		$	—	$	27,279		-9	%

		For the Year Ended December 31, 2001
		Segment Net Sales
		GAAP Results			Exited Businesses Inc/(Exp)		Ongoing Operations
Personal Communications Segment		$	10,768		$	—	$	10,768
Semiconductor Products Segment			5,098			—		5,098
Global Telecom Solutions Segment			6,514			—		6,514
Commercial, Govt, and Industrial
Solutions Segment			4,322			456		3,866
Broadband Communications Segment			2,885			—		2,885
Integrated Electronic Systems Segment			2,239			—		2,239
Other Products Segment			755			97		658
Adjustments & Eliminations			(2,095	)		—		(2,095	)
	Segment Totals	$	30,486		$	553	$	29,933

15

Motorola, Inc. and Subsidiaries
Special Items Description
(In millions)

        Summarized below are the Company's special items descriptions for: (i) the quarters ended March 30, June 29, September 28, and December 31, 2002, (ii) the quarters ended March 31, June 30, September 29 and December 31, 2001, and (iii) the years ended December 31, 2002 and 2001.

        Bracketed amounts represent income.

	2002 Special Items
	Quarter Ended March 30			Quarter Ended June 29			Quarter Ended September 28			Quarter Ended December 31			Year Ended December 31
Employee Severance, Net of Reversals	$	53		$	218		$	38		$	52		$	361
Exit Costs, Net of Reversals		(2	)		90			(2	)		(7	)		79
Fixed Asset Impairments		155			1,200			(5	)		30			1,380
Investment Impairments		188			955			77			33			1,253
Goodwill/Intangible Asset Impairments		—			326			—			—			326
In-Process Research & Development Charges		11			—			—			1			12
Potentially Uncollectible Finance Receivables (Telsim)		—			526			—			—			526
Iridium Settlements		—			—			(60	)		(3	)		(63	)
Gains on Sales of Investments and Businesses, Net		(11	)		(24	)		(37	)		(24	)		(96	)
Debt Redemption Charges, Net					—			—			98			98
Other		(20	)		57			(25	)		8			20
Pre-tax Special Items	$	374		$	3,348		$	(14	)	$	188		$	3,896
Income Tax Provision		(109	)		(988	)		36			(71	)		(1,132	)
After-tax Special Items	$	265		$	2,360		$	22		$	117		$	2,764

	2001 Special Items
	Quarter Ended March 31			Quarter Ended June 30			Quarter Ended September 29			Quarter Ended December 31			Year Ended December 31
Employee Severance, Net of Reversals	$	220		$	318		$	122		$	458		$	1,118
Exit Costs, Net of Reversals		33			143			48			167			391
Fixed Asset Impairments		108			296			51			392			847
Investment Impairments		29			194			830			159			1,212
Goodwill/Intangible Asset Impairments		72			—			—			44			116
Amortization of Goodwill		34			31			29			31			125
In-Process Research & Development Charges		—			—			20			20			40
Product Portfolio Simplification Write-Offs		405			168			10			—			583
Potentially Uncollectible Finance Receivables		—			100			1,354			47			1,501
Iridium Settlements		—			—			—			365			365
Gains on Sales of Investments and Businesses, Net		(614	)		(742	)		(542	)		(33	)		(1,931	)
Other		(17	)		(22	)		54			61			76
Pre-tax Special Items	$	270		$	486		$	1,976		$	1,711		$	4,443
Income Tax Provision		49			32			(732	)		(572	)		(1,223	)
After-tax Special Items	$	319		$	518		$	1,244		$	1,139		$	3,220

16

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Exhibit 99.1

Motorola, Inc. and Subsidiaries Consolidated Statements of Operations (In millions, except per share amounts)
Motorola, Inc. and Subsidiaries Consolidated Statements of Operations (In millions, except per share amounts)

EX-99.2

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Exhibit 99.2

Motorola, Inc. and Subsidiaries
Segment Information
(In millions)

Summarized below are the Company's orders by reportable segment for: (i) the quarters ended March 30, June 29, September 28, and December 31, 2002, (ii) the quarters ended March 31, June 30, September 29 and December 31, 2001, and (iii) the years ended December 31, 2002 and 2001.

	2002 Segment Orders
	Quarter Ended March 30		Quarter Ended June 29		Quarter Ended September 28		Quarter Ended December 31		Year Ended December 31
Personal Communications Segment	$	2,644	$	2,608	$	2,565	$	2,218	$	10,035
Semiconductor Products Segment		1,319		1,350		1,310		1,245		5,224
Global Telecom Solutions Segment		1,293		1,090		895		1,106		4,384
Commercial, Govt, and Industrial Solutions Segment		877		850		997		1,085		3,809
Broadband Communications Segment		537		420		385		353		1,695
Integrated Electronic Systems Segment		570		562		562		542		2,236

	2001 Segment Orders
	Quarter Ended March 31		Quarter Ended June 30		Quarter Ended September 29		Quarter Ended December 31		Year Ended December 31
Personal Communications Segment	$	2,900	$	2,978	$	3,043	$	2,280	$	11,201
Semiconductor Products Segment		1,125		1,091		1,137		1,063		4,416
Global Telecom Solutions Segment		1,558		2,023		1,580		1,142		6,303
Commercial, Govt, and Industrial Solutions Segment		1,165		1,170		1,006		1,144		4,485
Broadband Communications Segment		905		791		647		525		2,868
Integrated Electronic Systems Segment		513		554		545		482		2,094

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Exhibit 99.2