Motorola Plans 4,000 More Job Cuts

generic motorola jobs employment firing unemployed closed
CBS/AP
Cell-phone maker Motorola Inc. said Wednesday it will cut another 4,000 jobs as part of a plan aimed at improving sagging financial and operational results.

The company already is in the process of eliminating 3,500 jobs as part of a two-year cost-cutting plan designed to save $400 million. Those layoffs, announced in January, are to be completed by June 30, it said.

Motorola said it will save another $600 million in 2008 by cutting 4,000 more workers, prioritizing investments and putting controls on discretionary spending and general and administrative expenses.

"Long-term, sustainable profitability is, and always has been, Motorola's top priority," said Chief Financial Officer Tom Meredith. "Today's actions are an update to the commitment we made ... to drive out additional costs, and a continuation of the plan we announced in January."

The Schaumburg, Ill.-based company expects to take a restructuring charge of $300 million, or 8 cents per share in 2007, from severance and related expenses from staff cuts.

Motorola began efforts to cut back in January in an effort to recover from a series of miscues that caused it to lose about a third of its market value since October.

This spring, the company posted its first quarterly loss since 2004 and executives hinted those measures hadn't gone far enough. Wall Street was anticipating more cuts.

Motorola shares fell 2 cents in extended-hours trading after closing the regular session up 17 cents at $18.45.

"We are taking steps to ensure that, as these cost reductions are implemented, there will be no adverse impact on customer service and support, product quality and those research and development programs that are expected to contribute meaningfully to Motorola's revenues, profits and cash flow in 2008 and beyond," said Greg Brown, president and chief operating officer.