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Monday, August 13, 2012

Google to cut 4,000 Motorola Mobility jobs, shares rise | Reuters

A Motorola Droid phone is seen displaying the Google search page in New York August 15, 2011. REUTERS/Brendan McDermid

(Reuters) - Google Inc will slash 20 percent of the workforce of Motorola Mobility in the Internet search giant's largest job cuts ever as it moves to make more smartphones and fewer simple mobiles.
The news sent Google's shares up as much as 2 percent but analysts said it was unclear if the cuts were enough to restore the fortunes of Motorola, whose last hit was the Razr flip-phone launched eight years ago.
"I think it's still going to be challenging to navigate the waters (of the handset business); how do keep your partners happy and how you push your own smartphone devices at the same time," Morningstar Inc analyst Rick Summer said.
"This is the obvious step. The things that are harder are how do you drive profitability, how do you carve out a niche for Google devices, how to end up delivering solid returns on capital."

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