Motorola Inc. will slash another 7,000 jobs across all of its business
segments in an effort to size itself to fit the economic environment.
The Schaumburg, Ill.-based consumer-electronics provider and cable-gear maker
said the impact will affect all units and corporate-headquarters operations, and
the result will lower manufacturing, research and development, sales and other
expenses. Its total employee base will shrink 7 percent to 93,000.
'The restructuring will be substantially completed when the steps we are
announcing today are fully implemented. This means our businesses will be sized
to today's economic environment and our assets will reflect today's market
values,' president and chief operating officer Ed Breen said in a release.
The company will also take a total of $3.5 billion in charges, including $1.9
billion in restructuring costs, as it cuts 20 percent of its operational costs.
Some 90 percent of these charges will be taken in the second quarter, with the
remainder taken in the final two quarters of this year.
Amid the market chaos from the WorldCom Inc. implosion, Motorola nevertheless
is sticking by its second-quarter outlook, saying that sales for the quarter
will meet or slightly exceed $6.4 billion.
It still expects that excluding special items, the company will post an
operating loss of 4 cents per share. Despite that loss, Motorola is still
projecting that it will post earnings of 4 cents per share for the year.
Motorola will announce its second-quarter earnings July 16.