Arris Lays Off 500 EmployeesTrims Workforce Down to 6,500 About Two Months After Closing Motorola Home Deal 6/28/2013 8:56 AM Eastern
Arris this week laid off about 500 employees this week, a move that reduces its global workforce from 7,000 to roughly 6,500, according to the company.
It also comes about two months after Arris closed its $2.35 billion acquisition of Motorola Home, the maker of set-tops, cable modems and broadband access gear. Cuts were anticipated, as Arris has already said it expects to create $100 million to $125 million in annual synergies from the deal.
Arris did not identify which areas of the company were affected by the reduction. In April, when Arris closed the deal, company chairman and CEO Bob Stanzione told Multichannel News that such synergies would likely come from a “mix of sources, including cost of goods, G&A, marketing and sales, as well as R&D.”
“Our goal from Day One has been to bring the new ARRIS together with fully realized synergies as quickly and thoughtfully as possible. To that end, we are taking steps to drive organizational efficiencies and align our business teams in core locations to maximize collaboration, cost efficiencies and proximity to our customers,” Arris said, in a statement. “We understand how hard these changes will be for the employees concerned. ARRIS is committed to helping them through this difficult transition and will be providing severance packages, as well as outplacement services.”
Arris did not say if this week’s 6.8% workforce reduction will enable it to achieve the annual operational cost savings it’s targeting.
The company also has not announced the results of a product evaluation that’s taking a close look at overlaps in areas such as cable modems, cable modem termination systems and edge QAMs. Arris has stressed that it has no intentions of selling any redundant product lines, but will instead look to combine programs wherever it can.
Both Arris and Motorola had been working on integrated Converged Cable Access Platform (CCAP) products that combine the CMTS and edge QAM. Early on, Arris has emphasized the E6000, a CCAP-pointing device that’s starting off as a high-density CMTS but will add edge QAM capabilities later on. Comcast, Arris’s largest customer has already begun to deploy the E6000. Revenues tied to the E6000 began to trickle in during the first quarter of 2013.
Among other changes underway, Arris has until April 2013 to phase out the Motorola brand in its products. Arris intends to complete that task in less than a year, according to Stanzione.