Motorola revised its earnings forecast downwards yesterday, sending ripples of concern washing over rivals.

The handset giant now expects Q4 2006 revenue to come in between $11.6bn to $11.8bn, down from earlier estimate of $11.8bn to $12.1bn. Profit estimates were also revised down, and earnings per share are now expected to be 13 cents to 16 cents.

Motorola CEO Ed "Zandr" Zander put the blame on the wrong product mix and failing to address regional markets adequately.

The warning comes despite a healthy increase in volumes: Moto shipped 66 million units in Q4, 23 per cent up from the previous quarter.

Motorola earns the bulk of its earnings from mobile handsets, where it's No.2 to Nokia globally, but said that the performance of its networks and home divisions were on target. After two years of stellar results, Motorola's most recent quarter disappointed too.

The company discloses its earnings in full on January 19. ®