Motorola Mobility is cutting 1,200 staff, in addition to a reduction of 4,000 staff it announced in August, to focus on high-end devices.
"These cuts are a continuation of the reductions we announced last summer," said Motorola spokeswoman Katie Dove in an e-mail. "It’s obviously very hard for the employees concerned, and we are committed to helping them through this difficult transition."
Motorola’s mobile business has been overwhelmed in the smartphone market by larger players such as Samsung Electronics, Apple, Sony, Huawei Technologies and ZTE. Samsung, the largest smartphone maker in the fourth quarter, like Motorola, makes phones using Google’s Android operating system.
The revenue of Motorola’s mobile business as a result of knocks in the market was $1.51 billion, or 11% of parent Google’s consolidated revenue in the fourth quarter of 2012. It also had an operating loss of $353 million in the quarter. Apple in contrast posted revenue of $54.5 billion and net profit of $13 billion in the quarter ended 29 December.
Staff at Motorola were informed by e-mail this week that while the company is optimistic about new products in the pipeline, it still faces challenges, The Wall Street Journal reported Friday. The company added that its costs are too high, and it is operating in markets where it is not competitive and is losing money. The layoffs will affect workers in the US, China and India, according to the newspaper.
Motorola was acquired by Google in May, and it was thought that the Internet giant was mainly acquiring the company for its patents, and may not be interested in its mobile hardware business in a cut-throat market.
Google said in December that it planned to sell Motorola’s TV set-top box business to Arris Group, a broadband device vendor, for $2.35 billion.
Motorola had 11,113 staff in its mobile business and 5,204 in its home business at the end of December. The new cuts will hence reduce the staff in its mobility business by over 10%.
IDG News Service
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