Motorola (MOT) continues to struggle. The Schaumburg, Ill., handset maker posted a first-quarter continuing operations loss of $194 million, or 9 cents a share, compared with a year-ago loss of $218 million, or 9 cents a share. Excluding costs tied to recent job cuts, Motorola lost 5 cents a share, 2 cents better than the Wall Street analyst estimate.

But if the company’s bottom-line performance was slightly better than expected, the rest of its report wasn’t terribly upbeat. Motorola posted sales of $7.45 billion, down 21% from a year ago and short of the $7.7 billion consensus estimate. Sales in the hard-hit handset unit slumped 39% from a year ago, as Motorola sold 27 million handsets for the quarter. The drastic decline at that operation prompted Motorola to agree earlier this year to split off its handset and broadband businesses in a new company, as well as to give some board seats to dissident investor Carl Icahn, who has been criticizing Motorola for more than a year and who has called repeatedly for a splitup.

Motorola’s also bleeding cash, posting an operating cash outflow of $343 million in the first quarter. The company said it expects to lose 2 to 4 cents a share for the second quarter, excluding costs related to job cuts. Analysts were looking for a penny-a-share loss. Shares of Motorola, which have lost more than half their value over the past year during the handset unit’s implosion, dropped 35 cents in early trading Thursday to $9.20.

Motorola (MOT) and Carl Icahn have called a truce. The Schaumburg, Ill., tech giant agreed Monday to seat two of Icahn’s director nominees in exchange for Icahn’s agreement to drop a proxy fight. Motorola also agreed to “seek input” from Icahn on questions including who will head up Motorola’s struggling handset division once it is spun off to shareholders later this year. Motorola agreed last month to split off the handset and broadband business after a yearlong campaign by Icahn to force the company to reorganize itself.

Icahn, who owns more than 6% of Motorola through a series of purchases that began in 2007, when the stock was fetching nearly twice its recent trading price, celebrated Motorola’s decision. “This is a very positive step for Motorola in that shareholder representatives will have strong input into board decisions affecting the future of our company,” said Icahn. “In addition, the Motorola Board has also taken an important step forward for corporate governance in that the separated company which includes Mobile Devices will be essentially free from poison pills and staggered boards, both of which, in my opinion, serve to make democracy a travesty in corporate America.”

Chalk up another victory for Carl Icahn. Motorola (MOT) said Wednesday it would spin off its handset and broadband businesses to shareholders. The decision comes just two months after the activist investor urged the company to split itself in four and days after Icahn sued Motorola to force it to take action.

Motorola said it will search for a new chief executive to head up the handset unit, whose sales have collapsed since the once-popular Razr phone went out of style in 2006. The new chief will have his work cut out for him, given the handset business’ poor performance in recent quarters and the strong gains being chalked up by rivals such as Nokia (NOK) and iPhone maker Apple (AAPL).

“Our priorities have not changed with today’s announcement,” said Motorola chief Greg Brown in a statement. “We remain committed to improving the performance of our Mobile Devices business by delivering compelling products that meet the needs of customers and consumers around the world.” Motorola shares, which have lost half their value since Icahn started agitating early last year, rose 6% in early trading.

Carl Icahn still hasn’t posted anything on his blog, but the billionaire investor is having no trouble getting his message out. Icahn will appear Sunday night on CBS’ “60 Minutes” to discuss his investment victories, according to a press release from the TV network. The interview with Lesley Stahl finds Icahn shrugging off his failure to force a breakup at Time Warner (TWX), publisher of Fortune, in a 2006 showdown with then-CEO Dick Parsons. “It’s a little bit of he who laughs last,” Icahn tells Stahl.  “Maybe I made a mistake, but I made $300 million on it.”

Icahn says he also made $300 million with his recent foray into software company BEA Systems (BEAS), which agreed this year to sell itself to Oracle (ORCL). In that case Icahn appears to have succeeded in spite of himself: BEA held out and got a deal worth $19.38 a share after Icahn scoffed at the company’s decision to reject Oracle’s original offer of $17.

But while Fortune’s Shawn Tully last year dubbed Icahn the shrewdest investor on the planet, it’s clear that recently some of his bets haven’t gone as planned. Motorola (MOT), the struggling handset maker that Icahn recently boosted his stake in, is down sharply since he began building his position in 2007, and Blockbuster (BBI) continues to struggle despite Icahn’s success in booting former chief John Antioco. J.C. Penney (JCP), reportedly another big Icahn holding, dropped 10% Thursday after its latest weak same-store sales performance. It remains to be seen who will laugh last on those picks.

Can a little wheeling and dealing ease the pain at two struggling telecom players? Motorola (MOT) and Nortel (NT) are discussing a joint venture that would unite their wireless equipment businesses, The Wall Street Journal reports. The news comes just days after another big telecom gear company, Alcatel-Lucent (ALU), said sales of new wireless equipment fell short of expectations in the latest quarter, leading to a multibillion-dollar writedown. Even beyond the ill-fated Alcatel-Lucent tie-up, though, there is precedent for a wireless equipment deal: Two other big players, Nokia (NOK) and Siemens (SI), merged their infrastructure businesses into NokiaSiemens Networks last year.

Motorola and Nortel, of course, have their own problems. Motorola is trying to sell its money-losing handset business but wouldn’t mind unloading some other units as well to lighten the turnaround burden on new CEO Greg Brown. Nortel, meanwhile, has been flailing for years under CEO Mike Zafirovski, a Motorola alumnus who promised back in 2005 to return Nortel to industry leadership but has failed to make visible progress beyond a series of deep job cuts. One telling detail from the Journal story covers the proposed venture’s ownership structure. Nortel would own most of the new company and Motorola the rest, the Journal reports. The story adds that the companies initially wanted to bring in an outside investor to take a 20% stake, but that idea was “discarded after they had trouble finding a source of private equity.” No great surprise there.

Carl Icahn certainly doesn’t give up easy. The activist investor said Friday he’ll seek four board seats at struggling handset maker Motorola (MOT). The announcement comes a day after Motorola said it would consider Icahn’s suggestion to split off the company’s mobile devices business, which is losing money by the bucketful even as rivals such as Nokia (NOK) mint big sales gains.

“I believe that our slate of new candidates is necessary in order to help insure that the board moves aggressively to confront the many challenges Motorola faces in a highly competitive marketplace,” said Icahn, who owns 5% of Motorola. His nominees include former Viacom (VIA) chief Frank Biondi, brokerage exec Bill Hambrecht, MIT professor Lionel Kimerling and Icahn Enterprises (IEP) CEO Keith Meister. Icahn lost a bid to gain Motorola board seats last year after a marathon name-calling battle with then-CEO Ed Zander. Since then, though, Zander has stepped down in favor of Greg Brown - meaning that it’s just possible Motorola isn’t merely dodging and weaving when it says it is “currently reviewing the notice.”

Motorola (MOT) cried uncle. The struggling cell phone maker said after trading closed Thursday that it might have to separate its money-losing mobile devices business from the profitable networks businesses - just as activist investor Carl Icahn has been demanding. The move comes just a week after the company said the handset unit “remains challenged,” to the tune of a 38% drop in fourth-quarter sales. “The recovery in Mobile Devices will take longer than expected and there is a lot more work to be done,” new CEO Greg Brown said back on Jan. 23. Now, it seems that some of the work involves shopping the unit for a sale or perhaps trying to arrange a possible spinoff. Beyond the typical corporatespeak, Motorola remains vague about what exactly might be done, or why. “The company’s alternatives may include the separation of Mobile Devices from its other businesses,” Motorola said, “in order to permit each business to grow and better serve its customers.” Of course, the customer - as former chief Ed Zander learned the hard way - is always right.

Nokia (NOK) isn’t being pulled down by the Motorola (MOT) malaise. The Finnish handset giant posted a strong fourth quarter Thursday morning, saying profit rose 44 percent from a year ago to 1.84 billion euros ($2.66 billion), or 47 euro cents a share. Sales rose 34 percent from a year ago to $22.8 billion. Nokia says it continues to gain ground on its rivals in the cell phone market, with its worldwide market share rising a percentage point and the average selling price of its handsets ticking up to 83 euros from 82 euros in the third quarter.

“Nokia’s excellent fourth quarter contributed to a year of high growth and increased profitability for the company, while our industry leading product portfolio drove our device business to an estimated 40% market share in the fourth quarter,” said CEO Olli-Pekka Kallasvuo. “At the same time we again increased our quarterly device margins, allowing Nokia to continue to invest for innovation and growth.”

By contrast, Motorola on Wednesday posted a 38 percent decline in quarterly handset sales and pledged again to shake up its stagnant product lineup - a poor showing that sent shares plummeting 19 percent even as the stock market posted a sharp afternoon rally. Motorola’s struggles help to explain why Nokia expects to gain market share again in the first quarter even in the seasonally slow first quarter - and why investors expect the quarter to be much slower for fading Motorola than for hard-charging Nokia.

Motorola (MOT) continues to spin its wheels. The wireless giant said its fourth-quarter profit from continuing operations fell to $111 million, or a nickel a share, from the year-ago $523 million, or 21 cents a share. Excluding restructuring charges, the company made 14 cents a share, a penny better than the Wall Street analyst consensus estimate. Motorola cited strong results at its networking businesses, the mellifluously named Home & Networks Mobility and Enterprise Mobility Solutions units, but said its handset division “remains challenged.” The handset business swung to a $388 million operating loss from a year-ago profit of $341 million, as sales plunged 38 percent year-over-year. 

Indeed, the handset business is so challenged that Motorola - which has been losing market share to industry leader Nokia (NOK) and others - expects to lose money for the first quarter. The company forecast an operating loss of 5 to 7 cents a share for the quarter, where analysts were looking for a profit of a dime a share. That projection sent the stock - already trading within a dollar of its 52-week low - tumbling 11 percent in early action to just over $11 a share.

“We are focused on aggressively rationalizing the company’s cost structure and working to get Mobile Devices back on track,” said CEO Greg Brown, who was tapped late last year to step in for the departing Ed Zander. “The recovery in Mobile Devices will take longer than expected and there is a lot more work to be done.” Given the poor results at Motorola’s handset business and the sharp decline of the company’s stock, Brown may soon be hearing from restive shareholder Carl Icahn.

Now this from Fortune’s Stephanie Mehta:

Don’t cry for Padmasree Warrior. Motorola’s (MOT) former chief technology officer already has a new gig: Cisco (CSCO) today announced she’s becoming its CTO. 
 
Warrior, 47, is a skilled speaker and presenter (and, some would argue, a tireless self-promoter). That makes her a great fit for Cisco, where marketing savvy is a valued trait.
 
And indeed, Cisco CEO John Chambers in a news release said Warrior “will help to develop and promote Cisco’s future technology leadership.”
 
We caught up with Warrior for a few moments today. She was mum on when she and Chambers started talking about her move to Cisco, citing confidentiality, except to say she resigned from Motorola Friday afternoon. (Motorola disclosed her departure Monday.)
 
She said she was drawn to Cisco because, as she says, the company is “at the heart of the second phase of the Internet revolution” and its new wave of networks built around collaboration. It probably doesn’t hurt that Cisco seems to be on solid footing these days, with strong growth prospects and a market capitalization hovering around $164 billion (See Rik Kirkland’s “Cisco’s display of strength“). Warrior’s old employer, meanwhile, isn’t doing quite so well. Her former boss Ed Zander just resigned as CEO, and Motorola’s market value is a tepid $36 billion.