updated 07:56 am EDT, Thu October 4, 2012
Google restructuring plans at Motorola continue with job losses
Google has said that it plans further job cuts at Motorola while warning of more restructuring to come at the handset maker, reports Reuters. The next round of job cuts are estimated to cost up to $340 million in severance payments. Google’s first round of job cuts in August resulted in up to 4,000 staff losing their jobs and the closure of up to a third of its offices around the globe.
At that time, new Motorola CEO Dennis Woodside said that the cuts were necessary as the company was readjusting its strategy to focus on developing fewer, but high-end handsets. “Motorola has continued to refine its planned restructuring actions and now expects to broaden those actions to include additional geographic regions outside of the U.S.," reads a statement issued by Google today.
Moving forward, Motorola also warned that more jobs at are looming. "Motorola continues to evaluate its plans and further restructuring actions may occur, which may cause Google to incur additional restructuring charges, some of which may be significant,” the company added somewhat ominously for Motorola staff.
When Google acquired Motorola for over $12 billion, it was a decision driven largely by Motorola’s 17,000 patent arsenal to help defend Android from litigation. While the merits of that decision have been debated, Motorola’s financial position has been progressively getting worse with 14 out of 16 recent quarters resulting in losses. In order to placate its Android partners concerned by Google’s acquisition of Motorola, the company made it clear that Motorola would not receive any special favors.