Motorola to Cut 4,000 Jobs in 2009

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    TK
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    The Schaumburg, Ill.-based company said Wednesday it expects revenue for the fourth quarter to be between $7 billion and $7.2 billion, as it saw continued weakness in consumer demand and customer inventory reductions.

    Mobile handset maker Motorola Inc. said Wednesday it will cut 4,000 more jobs in 2009, in addition to 3,000 it announced last year.

    The company said the move will save about $700 million a year starting in 2009, and totaling $1.5 billion in annual savings when combined with the previous cut.

    Most of the new layoffs will hit the mobile devices business, while about 1,000 jobs are tied to corporate functions and other business units.

    The move is the latest in cost-cutting measures by Motorola, which has been struggling to revive its business in recent years. In December, it announced it was freezing its pension plans and reducing executive pay.

    The Schaumburg, Ill.-based company also said Wednesday it expects revenue for the fourth quarter to be between $7 billion and $7.2 billion, as it saw continued weakness in consumer demand and customer inventory reductions.

    Analysts polled by Thomson Reuters expected, on average, $7.5 billion in revenue.

    The company also said it expects a fourth-quarter net loss from continuing operations between 7 cents and 8 cents per share, including 6 cents per share of restructuring costs and other charges. The estimate did not include new charges for the layoffs announced Wednesday, which could widen the loss.

    Analysts were looking for a profit of 3 cents per share.

    "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 Motorola's co-chief executive, Sanjay Jha, in a statement.

    Motorola shares fell 21 cents, or 4.9 percent, to close at $4.11 Wednesday, and dropped another 5 cents to $4.06 in after-hours trading following the announcement.