Baird's Tech Research team is back from their Asia tour saying that their meetings point to more optimism than a quarter ago. Motorola (NYSE:MOT) remains weak, but the low-end mobile phone segment at tier-one OEMs is recovering, following a weak 1Q, and China appears particularly strong (low- and mid-end phones).
High-end phone demand is also improving, with 3G orders coming back since the past month. Mobile RAM demand continues to pick up. Motorola component orders are seen down sequentially in 2Q as the company continues to work down internal component inventories, with no rebound in sight until mid-3Q, a couple of months later than what was expected in the first quarter.
Across the food channel, the industry participants the firm talked to have little clarity on Motorola's strategy and new model roadmap, particularly at the low end given still high levels of component inventories for the Motofone which is pushing out new model introductions, while the company's new high-end offering is generating a less-than-enthusiastic response from the suppliers the firm talked to. At Nokia, which appears to track about in line with seasonality, component orders should be flat to up slightly in the quarter, with new phones driving component supplier revenues higher in 3Q.
Notablecalls: Just some color on MOT. Yet, did you notice the stronger than expected results released by OmniVision (NASDAQ:OVTI) last night? Motorola is a major customer of OVTI.