Unlike rivals, Google has never had to cut a significant share of its workforce -- until now. Setting a course for profitability, Google-owned Motorola is cutting 4,000 jobs, or roughly 20% of its employees.
“Larry Page, who became the chief executive officer of Google last year, is streamlining the company as it pushes into the hardware market,” Bloomberg writes.
“Fueling the job cuts, Motorola has not been profitable the last 14 out of 16 quarters -- even with popular smartphones like the Motorola DROID RAZR and RAZR HD on the market,” writes 9to5Google.
First reported by The New York Times, the news was confirmed in a U.S. Securities and Exchange Commission filing on Monday.
“These changes are designed to return Motorola’s mobile devices unit to profitability,” Google said in its filing. “Investors should expect to see significant revenue variability for Motorola for several quarters.”
“Google will still face challenges in turning around Motorola and in showing its Android manufacturing partners that it’s not giving Motorola preferential treatment,” GigaOm writes. “It will need to churn out some winning devices to justify the Motorola purchase, but if it’s too successful, it may raise the ire of Android manufacturers.”
“A third of the job cuts are reported to be coming from its US operations, following an earlier reshuffle that saw Motorola lose 40% of its vice presidents,” The Verge notes.
“It’s not surprising that the majority of the cuts will happen outside the U.S., since this is what appears to be driving a lot of the decline at Motorola, as it competes against much bigger players like Apple and fellow-Android licensee Samsung,” TechCrunch points out.