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

FORM 10-Q

Commission file number: 1-7221

MOTOROLA, INC.
(Exact name of registrant as specified in its charter)

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

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        The number of shares outstanding of each of the issuer's classes of common stock as of the close of business on June 28, 2003:

Index

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Part I—Financial Information

Motorola, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

(In millions, except per share amounts)

See accompanying notes to condensed consolidated financial statements.

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Motorola, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In millions, except per share amounts)

See accompanying notes to condensed consolidated financial statements.

4

Motorola, Inc. and Subsidiaries

Condensed Consolidated Statement of Stockholders' Equity

(Unaudited)

(In millions)

See accompanying notes to condensed consolidated financial statements.

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Motorola, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In millions)

See accompanying notes to condensed consolidated financial statements.

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Motorola, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollars in millions, except as noted)

1.     Basis of Presentation

        The condensed consolidated financial statements as of June 28, 2003 and for the three months and six months ended June 28, 2003 and June 29, 2002, include, in the opinion of management, all adjustments (consisting of normal recurring adjustments and reclassifications) necessary to present fairly the financial position, results of operations and cash flows as of June 28, 2003 and for all periods presented.

        Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto incorporated by reference in the Company's Form 10-K for the year ended December 31, 2002. The results of operations for the three months and six months ended June 28, 2003 are not necessarily indicative of the operating results to be expected for the full year. Certain amounts in prior periods' financial statements and related notes have been reclassified to conform to the 2003 presentation.

        The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

2.     Other Financial Data

Statement of Operations Information

Other Charges (Income)

        Other Charges (Income) included in Operating Earnings (Loss) consist of the following:

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Other Income (Expense)

        The following table displays the amounts comprising Interest Expense, net, and Other included in Other Income (Expense) in the Company's condensed consolidated statements of operations:

Income Tax Expense (Benefit)

        The effective tax rate was (6)% in the second quarter of 2003, representing a $7 million net tax benefit, compared to a 29% effective tax rate, representing a $969 million net tax benefit, in the second quarter of 2002. The effective tax rate was 22% for the first six months of 2003, representing an $81 million net tax expense, compared to a 30% effective tax rate, representing a $1.2 billion net tax benefit, in the first six months of 2002. The lower effective tax rate in 2003 reflects a $61 million benefit from the reversal of previously accrued income taxes, partially offset by a $32 million non-deductible acquisition charge. The reversal of the previously accrued income taxes reflects a reassessment of the Company's income tax requirements given the current status of its ongoing income tax audits.

Earnings (Loss) Per Common Share

        The following table presents the computation of basic and diluted earnings (loss) per common share:

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        In the computation of diluted earnings per common share for the three months and six months ended June 28, 2003, the assumed conversions of the zero coupon notes due 2009, the equity security units and out-of-the-money stock options were excluded because their inclusion would have been antidilutive. In the computation of diluted earnings (loss) per common share for the three months and six months ended June 29, 2002, the assumed conversions of the zero coupon notes due 2009 and 2013, all stock options, restricted stock and the equity security units were excluded because their inclusion would have been antidilutive.

Balance Sheet Information

Accounts Receivable

        Accounts Receivable, net, consist of the following: