today confirmed guidance for its fourth quarter it had earlier offered investors — the company said it’ll post an operating loss of about 4 or 5 cents per share after all is said and done. The company also announced another round of cost cutting measures that it hopes will bring its business back to profitability.
Motorola claims its latest budget-trimming efforts will result in a US$865 million savings in 2002 and about $1.1 billion annually thereafter. “The greatest impact of these actions is in the Semiconductor Products segment,” said Motorola.
Among many other things, Motorola manufactures the PowerPC chips used inside Macintosh computers. Semiconductor Products is the segment of Motorola’s business that handles the manufacture and development of products including the PowerPC.
Motorola has already notified 4,100 employees since October that they’ve lost or are losing their jobs. Motorola also plans to phase out certain manufacturing facilities used by the Semiconductor Products Sector over the course of the next year — 4,000 Motorola employees are expected to lose their jobs accordingly. Another 1,300 jobs are going to be cut across Motorola’s equipment manufacturing businesses over the next year. “Therefore, the total of these actions is expected to result in a further reduction of approximately 9,400 employees company-wide, expected to occur over the next twelve months,” said Motorola.
Motorola chairman and CEO Christopher B. Galvin said he expressed sincere regret about the loss of jobs, but cited Motorola’s need to improve overall efficiency and competitiveness in order to get back to profitability.
“We also intend to continue to maintain a strong cash position and balance sheet, with an expectation of a lower average debt level in 2002. Our new management team is committed to these objectives … these initiatives, when coupled with the energy of all ongoing Motorola associates globally and the focus of our leadership team, will result in a leaner, more flexible and more profitable company in a global environment less predictable than in past eras,” said Galvin.