Motorola axes a further 4,000 jobs as it prepares to report Q4 results

Motorola has announced that it will further reduce its workforce in 2009 by approximately 4,000 positions. This reduction will include approximately 3,000 positions associated with the Mobile Devices business and approximately 1,000 positions associated with corporate functions and other business units. The workforce reductions, which were announced yesterday, are expected to begin immediately and are incremental to the 3,000 workforce reductions previously announced during Q408.

Motorola’s co-CEO Sanjay Jha says the company is making good progress in developing smartphones for 2009, despite quarterly handsets shipments dropping from 40.9 million units in Q407 to 19 million units in Q408

Motorola estimates that these combined workforce reductions are expected to result in additional annual cost savings of approximately US$700 million in 2009. The savings from the latest actions, together with the US$800 million of savings from other actions announced during Q408 are expected to result in aggregate cost savings of US$1.5 billion in 2009.

“Together with these actions and the announcements made in the fourth quarter, the Mobile Devices business expects to recognise annual cost savings of approximately US$1.2 billion in 2009,” said Sanjay Jha, co-chief executive officer of Motorola. “Additionally, we are making good progress in developing important new smartphones for 2009 and are pleased with the positive response from our customers to these new devices,” he added.

With respect to preliminary Q408 results, Motorola announced that during the period, Mobile Devices shipped approximately 19 million units. Motorola stated that sales were adversely impacted by continued weakness in end-consumer demand and customer inventory reductions. By comparison, in Q407 Motorola shipped 40.9 million devices.

Motorola announced it ended the year with a total cash position of approximately US$7.4 billion, with total sales for the fourth quarter expected to be in the range of US$7.0 billion to US$7.2 billion.