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Analyst lowers revenue forecasts for Motorola Xoom due to poor sales

RBC Capital Makers analyst cuts forecasts on Motorola stock due increasing competition and slow Xoom sales.

The first consumer tablet released with Android Honeycomb has made plenty of headlines, but not all are particularly praising the device. The Motorola Xoom is currently facing lower than expected sales, and that was enough to revise at least one analyst’s revenue forecast for Motorola.

Analyst Mark Sue of RBC Capital Makers has reportedly lowered his price target for Motorola Mobility stock, from $38 down to $33, according to BGR. He cites the change as necessary due to “increased competition and slow sales of the Motorola Xoom tablet.” Sue now expects 300,000 Xoom tablet sales for the upcoming second quarter instead of his initial estimate of 400,000.

The 10.1-inch Motorola Xoom was launched late February, not too long before the iPad 2 became available in the United States. Since then, the Apple tablet has eclipsed the Xoom in sales and even graphics performance. Upcoming tablets, such as the HTC Evo View 4G for Sprint, are only going to complicate the situation for Motorola’s latest tablet.

Back in January, Motorola was reportedly aiming for a shipment of around 700,000 to 800,000 Xoom units for the U.S. between its February launch date and the end of March. Perhaps the company was a bit too optimistic about its Xoom numbers if Sue’s numbers are accurate.



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Allen Ngo, 2011-04- 5 (Update: 2012-05-26)