Motorola job cuts cost company more than $300M so far
By Colleen Taylor, Contributing Editor -- EDN, October 3, 2007
Although layoffs are intended to cut company costs in the long run, Motorola Inc. has taken a heavy hit of fees related to the thousands of job cuts it has implemented in recent months.
In a filing made today with the Securities and Exchange Commission (SEC), Motorola revealed that during the first half of 2007, the company paid some $221 million in severance charges to the 4,100 employees that had been laid off. The lay-offs were part of a host of "cost-reduction initiatives" taken on by the company in an attempt to bounce back from a series of lackluster financial reports.
The job cuts have continued in Q3, as well. Motorola added that it cut another 1,000 jobs in the quarter, which ended this week. For these most recent cuts, the company said it expects to pay net pre-tax charge of about $83 million in related severance fees. Motorola said that the majority of the employees affected in the Q3 job cuts are located in Germany.
Motorola's Q3 earnings report is slated to be released later this month.
