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16 January 2009


Motorola cuts 3000 more staff in Mobile Devices

In fourth-quarter 2008, Motorola Inc’s Mobile Devices business shipped just 19 million units after sales were adversely impacted by continued weakness in end-consumer demand and customer inventory reductions. According to preliminary results, Motorola expects revenue of $7-7.2bn, and a net loss from continuing operations of $0.07-0.08 per share (including estimated net charges of about $0.06 per share).

To save another $700m annually, Motorola has announced further cost-cutting actions for 2009, involving reducing staffing by about 4000 (including about 3000 associated with the Mobile Devices business and 1000 associated with corporate functions and other business units).

Together with fourth-quarter 2008’s announcement of 3000 job losses (to save $800m annually), total savings for 2009 should amount to $1.5bn, including $1.2bn in the Mobile Devices business.

The actions in the Mobile Devices business should allow Motorola to further reduce its cost structure and positions it for improved financial performance in 2009, says co-CEO Sanjay Jha.

In fourth-quarter 2008, the Enterprise Mobility Solutions and Home and Networks Mobility businesses continued to perform very well despite the challenging environment. “Our Broadband Mobility Solutions businesses remain strong, are substantial franchises, and are continuing to perform very well,” says president & co-CEO Greg Brown. “Additionally, we are making good progress in developing important new smartphones for 2009 and are pleased with the positive response from our customers to these new devices,” Jha adds.

Motorola ended 2008 with a total cash position of about $7.4bn. The latest actions should allow Motorola to further reduce costs, improve operating cash flow, and help ensure that Motorola remains competitive and financially strong during the current challenging times, add Brown and Jha.

Full fourth-quarter 2008 results will be given on 3 February.

See related items:

Mobile sales to show low single-digit decline in 2009

Mobile handset unit shipments continue to grow

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