Chicago-based telecommunications equipment maker Motorola
plans to cut about 7,000 jobs and absorb $3.5 billion in charges as part of
a company-wide restructuring move.
Hurt by a drop in spending on telecommunications gear, Motorola said the
cuts were necessary to reshape the company after the excesses of the telecom
and dot-com booms. The company said the latest cuts would end its ongoing
Over the long term, Motorola the cost reduction actions would reduce
expenses by more than 20 percent and save $100 million for the remainder of
2002 and $700 million annually.
Motorola said the bulk of the $3.5 billion charge would be absorbed in the
second quarter with the remainder to be spread out over the third and fourth
quarters. It would reduce annual net income by $1.10 per share.
“This comprehensive restructuring purposefully returns Motorola to
approximately its mid-1990s size, the era prior to the excesses of the
telecom and dot-com booms,” Motorola CEO Christopher Galvin said.