Cellphone-maker Motorola has announced it is reducing its worldwide headcount by approximately 4,000 in a strategy focused on increasing its profitability.
Motorola Mobility, acquired last year by Google for US$12.5 billion, has said it is yet to shed more light on the worldwide planned cuts — or 20 percent of its workforce as part of its reform process.
Although Motorola has not confirmed any losses in any region outside of its home country until now, out of the 4000, two-thirds of the reduction is set to occur outside of the United States.
The company has also said it intends to close or merge about one-third of its 90 facilities aside from simplifying its mobile product selection by shifting its production emphasis from feature phones to more innovative and profitable devices.
The company’s spokesperson said while they expect this strategy to create new opportunities and help return its mobile devices to world prominence, the company is aware of how difficult it will be for employees concerned and it is committed to helping the affected workers through the difficult transition.
The company has hence vowed to offer generous severance packages, as well as outplacement services to help those who would be affected find new jobs.
The company had made known its intention to “close or merge” approximately one-third of its worldwide 90 production and research facilities, reported the BBC.
Motorola Mobility’s report, released recently, showed the company recorded a loss of US$86 million in the first quarter of this year, which was greater than the US$81 million net loss it made in the same period last year. The company sold nearly 9 million mobile devices in the first three months of 2012. About 5.1 million were smartphones.
Headquartered in Illinois, USA, Motorola is an American multi-national telecommunications company founded in 1928 with about 60,000 employees as of year 2010. After losing US$4.3 billion from 2007 to 2009, the company was divided into Motorola Mobility and Motorola Solutions.