Ed Zander, a chief executive of Motorola Inc., will step down on Jan. 1, the company said.
Zander, 60, will be replaced by President and Chief Operating Officer Greg Brown as CEO.
Zander will stay on as chairman until the company's annual shareholders meeting in May 2008.
A two-year run of success Motorola enjoyed following the launch of its Razr phone began crumbling last year after sales slowed and the company admitted it had been trading profit margins for global market share by aggressively undercutting pricing.
Motorola has since slipped to third place in the cell phone market behind Samsung Electronics Corp. and remains far behind leader Nokia Corp.
Last month, Motorola reported a 94 percent drop in third-quarter profit but still managed to impress Wall Street with its progress, improving from a dismal first-half performance and showing that its turnaround effort may be taking hold.
The cell-phone unit, Motorola's biggest, saw quarterly sales plunge 36 percent to $4.5 billion (EUR3.05 billion) and recorded an operating loss of $138 million (EURO 93.64 million). That was nearly $1 billion worse than a year ago but only about half the $264 million (EUR179.13 million) loss of the second quarter.
Brown joined the company in 2003 and has served as president and COO since March. Prior to joining Motorola, Brown was chairman and CEO of Micromuse Inc., a network management software company.
The stock remains down in 2007 and is 40 percent off its six-year high of $26.30 reached just a little more than a year ago.