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Struggling Motorola to cut thousands more employees

post #1 of 10
Thread Starter 
Sales of Motorola cellphones collapsed more than 50 percent this past holiday season, forcing the company to announce that it will eliminate another 4,000 jobs as Apple and other rivals loom in the background.

Most of those positions, 3,000 of them, will be cut from the Mobile Devices business while the rest are from corporate functions and other business units.Â* The cuts begin immediately and will join the 3,000 employees already let go in the fourth quarter of 2008 for a total of 7,000 in the last two months.Â* The latest round of cutbacks are intended to save another $700 million and join the $800 million planned savings from the summer quarter's restructuring efforts.

According to preliminary financial results, Motorola sold only 19 million phones in the fourth quarter, compared to 25.4 million in the third quarter and 40.9 million in the fourth quarter of 2007.Â* The company will announce official figures shortly after the end of the month.

"The actions we are taking today in our Mobile Devices business will allow us to further reduce our cost structure and positions us for improved financial performance in 2009," said co-chief executive Sanjay Jha, who was hired last August to manage the handset division.Â* "Together with these actions and the announcements made in the fourth quarter, the Mobile Devices business expects to recognize annual cost savings of approximately $1.2 billion in 2009."

The news isn't good for the future of Motorola's mobile devices, which have struggled against new products from other companies without a clear successor to the popular but outdated RAZR. Apple's iPhone in the fall overtook Motorola for the top-selling phone in the US despite a major price difference and the limitation of the iPhone to AT&T's network and Apple having sold just 6.9 million iPhones total during its last quarter.

Most Motorola phones are low- to mid-range devices, with most of its smartphones based on Microsoft's Windows Mobile. Its future smartphones are expected to run Google's Linux-based Android platform.

In contrast to the loss-making Mobile Devices group, the company reports that its Enterprise Mobility Solutions and Home and Networks Mobility businesses have fared well.

The last two months have seen Motorola cut 7,000 jobs.Â* and have contributed to a total of about 17,500 eliminated positions in the last half-decade as the company scales back from the heights of its success. Â*The company employed as many as 150,000 staffers worldwide at the beginning of 2000. Â*

At press time, Motorola stockÂ*was up 6.33% to $4.37 per share in a reaction to the company's cost-cutting efforts.
post #2 of 10
If anyone "bails out" Motorola, they'd need to have their head examined.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #3 of 10
I really feel sorry for those that have been axed. Motorola did have some excellent engineers but they've been let down by a string of terrible CEOs.

I've got a feeling that Sanjay Jha will turn things around though. He's got a very good track record from his days at Qualcomm. The measures he's implemented (only 12 devices a year, smartphones based on Android only) are extreme enough that they've got a very good chance of returning to profitability. It doesn't look like they'll be regaining market share any time soon though.
post #4 of 10
Google also has been laying off employees. It's the market right now, welcome to a recession.

Hope everyone can find a job.
post #5 of 10
Quote:
Originally Posted by SpamSandwich View Post

If anyone "bails out" Motorola, they'd need to have their head examined.

Don't really understand that. Who is saying anything about bailing out?

They are simply cutting staff just like about every other company in the world. I never read anything in this article about Motorola being in any financial trouble.

It's good to have a laugh at people losing their jobs I suppose. Will you be laughing if Apple make a similar announcement?
post #6 of 10
I can remember, 18 years ago, when I graduated college, that Motorola was considered one of the good places to work, if you could get there. Since then the company has been a basket case, constantly downsizing - it would have been a nightmare to have worked there during these years (constant worry about getting layed off, constant harranging to save money)...I can only imagine.

How sad, for a once great US company.
post #7 of 10
What is hurting Motorola are:

1) Companies like Nokia, Samsung and LG taking the market for all the low end cellphones.

2) Blackberry and Apple's iPhone taking all the market for high end cellphones.
post #8 of 10
What pisses me off, is that some guy like Zander walks off with a fat golden parachute after running the company into the toilet with an aging RAZR and no future models ready. Now, probably hard-working lower-paid employees gotta eat crap and start pounding the streets in an economy where jobs will be hard to find. What happened to Symbol Technologies, a company doing pretty well and then Motorola comes along to buy it up. Motorola was always grabbing companies to no avail. Gdamn Motorola practically invented the cellphone and just sat back and let every other cellphone or electronics company slide on by them. What a useless bunch of executives. They had all those years of being in China to make some dent in global sales and didn't do a damn thing. Everything Motorola touches turns to crap.
post #9 of 10
Quote:
Originally Posted by Murphster View Post

Don't really understand that. Who is saying anything about bailing out?

They are simply cutting staff just like about every other company in the world. I never read anything in this article about Motorola being in any financial trouble.

It's good to have a laugh at people losing their jobs I suppose. Will you be laughing if Apple make a similar announcement?

It was more a criticism of the TARP than anything... sorry to upset you.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #10 of 10
Quote:
Originally Posted by Constable Odo View Post

What pisses me off, is that some guy like Zander walks off with a fat golden parachute after running the company into the toilet with an aging RAZR and no future models ready. Now, probably hard-working lower-paid employees gotta eat crap and start pounding the streets in an economy where jobs will be hard to find. What happened to Symbol Technologies, a company doing pretty well and then Motorola comes along to buy it up. Motorola was always grabbing companies to no avail. Gdamn Motorola practically invented the cellphone and just sat back and let every other cellphone or electronics company slide on by them. What a useless bunch of executives. They had all those years of being in China to make some dent in global sales and didn't do a damn thing. Everything Motorola touches turns to crap.


CO,
I do not disagree, but, how many other companies are in the same waters?
MS for instance.

However, those employees should have had a keen eye on management, and made a judgement call, and ALWAYS have a backup plan! (Self Insurance).
Of course!

We're very fortunate that Apple has a plan.

A recession is not something to worry about.
It's kind of like, a late spring ice storm, where mother nature does her "Pruning". Yea?

And, the fat Does Need to be Cut!

You don't eat the waste on your 2" thick slice of Prime Rib @Outback, do you?
Of course not.
Fat gets cut.

The problem is, that those who are "fat", (please, pardon my terminology),
should realize such, and it's their own responsibility to make themselves more viable
employees, for the company that is well managed!

Through all my years in "da bidness", (and any other employer would probably agree with me),
except that joker from the "greenland",
the biggest obstacle to solid growth, was and is, GOOD HELP.

Can I make it any plainer?

Any one who's laid off, hasn't planned their employment well, or unfortunately is young. (They've got time). But a middle ager who is laid off, should have had a back up plan.
I recommended it to ALL of my employees, and, anyone I know.

I do not want to hold responsibility, as an employer, for what is the employee's own problem.

Be Good.
You'll be lonesome.
Until everyone else is lonesome.
Then, you'll be free.


MO
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