Motorola handing out pink slips
Second place mobile phone maker Motorola plans to slash 3,500 workers, or five percent of its workforce. During a call to discuss fourth quarter earnings, chairman and CEO Ed Zander said the cuts could save the company about $400 million over two years. The news comes amid a backdrop of higher Motorola sales and lower profits. The bottom line: fourth-quarter 2006 income fell 48 percent.
Motorola said it earned $624 million in the fourth-quarter of 2006 compared to $1.2 billion for the same quarter in 2005. The company said sales for the quarter reached $11.8 billion, matching revised expectations that Motorola issued earlier this month. In October Motorola projected fourth-quarter sales would reach $12.1 billion.
Despite shipping more than 67 million handsets, including 25 new phones during the quarter, Motorola's Mobile Devices unit earnings dropped to $341 million during the quarter, down from $663 million in 2005. Motorola blamed "an unfavorable geographical and product-tier mix" for the shortfall.
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