Johnson & Johnson reported disappointing quarterly revenue due to plunging U.S. sales of consumer products that continue to be recalled for quality-control lapses, and the diversified healthcare company forecast 2011 earnings below Wall Street expectations.

The fourth quarter was another disappointing quarter for Johnson & Johnson, said Morgan Stanley analyst David Lewis, who questioned whether the company can recover this year from factory problems that have sparked recalls of Tylenol, Motrin and other over-the-counter medicines over the past 12 months.

J&J, whose shares were down more than 2 percent, said on Tuesday that fourth-quarter earnings fell to $1.9 billion, or 70 cents per share, from $2.2 billion, or 79 cents per share, a year earlier.

Excluding special items, J&J earned $1.03 per share. That matched the consensus Wall Street forecast, largely because of unexpectedly low taxes.

Global sales fell 5.5 percent to $15.6 billion, compared with Wall Street expectations of $16 billion.

Worldwide consumer product sales dragged down results, as they did in the prior quarter, falling 15 percent to $3.61 billion. U.S. sales of J&J's many consumer brands plunged 29 percent to $1.22 billion, reflecting a continuing train of recalls that have tarnished the company's reputation and taken scores of products off the market.

J&J has recalled more than 300 million packages of Tylenol and other consumer medicines in the past year after regulators cited grime, faulty procedures and other quality-control lapses at a plant in Fort Washington, Pennsylvania, and other factories.

In its latest big action, J&J recalled 50 million bottles and packages of Tylenol, Benadryl, Rolaids and other products two weeks ago because of lax cleaning procedures and other problems at the Pennsylvania plant, which was closed in April for a major overhaul.

Wells Fargo analyst Larry Biegelsen said J&J had managed to meet quarterly profit forecasts because its tax rate was five percentage points below expectations in the period, masking weak sales of consumer brands and prescription drugs.

Global pharmaceutical sales fell 4.7 percent to $5.71 billion, while medical device sales edged up 0.2 percent to $6.32 billion.

J&J forecast 2011 earnings, excluding special items, of $4.80 to $4.90 per share, below Wall Street expectations of $4.97. The company's outlook would represent a profit increase of 1 percent to 3 percent over 2010 results, compared with analysts' prior hopes of 5 percent growth.

Shares of J&J were down 2.3 percent at $60.78 in early trading.

(Reporting by Ransdell Pierson, editing by Maureen Bavdek and Matthew Lewis)

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