Google Investor: Google: Significant Motorola Restructuring Costs Ahead

Thursday, October 4, 2012

Google: Significant Motorola Restructuring Costs Ahead

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Google Warns of More Motorola Cuts, Revises Up Third-Quarter Bill

(Reuters) Google Inc revised up the bill for job cuts at its money-losing Motorola Mobility mobile phone unit in the third quarter and warned of further restructuring that may result in "significant" additional charges.

"Google raised its estimates for severance-related charges 9 percent to $300 million from $275 million and warned it faced another $40 million in other costs in the quarter to quit facilities and markets.

"Motorola has continued to refine its planned restructuring actions and now expects to broaden those actions to include additional geographic regions outside of the U.S.," the company said in a statement.

Google Warns of 'Significant' Motorola Charges

(CNBC) Google said planned job cuts at its Motorola Mobility mobile phone unit will cost about $340 million in severance and other costs in the third quarter and it warned of further restructuring that may result in "significant" charges.

Google plans to shrink Motorola's operations in Asia by exiting unprofitable markets, abandoning low-end devices and focusing on a few models instead of dozens, the New York Times had reported earlier.

"Motorola continues to evaluate its plans and further restructuring actions may occur, which may cause Google to incur additional restructuring charges, some of which may be significant," the company said.

The Internet search giant said in August that it would cut 20 percent of the workforce at Motorola Mobility, which it bought for $12.5 billion last year, as it moves to make more smartphones and fewer simple mobiles.

By pairing Motorola's smartphone business with its Android software, Google may have a better chance of mounting a direct challenge to Apple's popular iPhone.

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