Yesterday, Lenovo announced some rather poor financial results, the company’s mobile division posted a pre-tax loss of $292 million and saw a 31 percent decline in smartphone shipments year over year. As a result, Lenovo announced a major workforce lay off program which will see the company cut 10 percent of its non-manufacturing positions.
News from Crain’s Chicago Business, a local business publication, states that 500 of these jobs will be cut from Motorola’s HQ in Chicago. A little under 2000 people are employed at the Merchandise Mart, the location of Motorola’s new HQ, meaning that approximately 25 percent of the local workforce will lose their jobs, much higher than the 10 percent average that Lenovo announced yesterday.
“We will maintain a substantial employee base there, as well as our labs and design facilities … The Merchandise Mart continues to be our headquarters and will still be the hub for global R&D and home for our labs.” – Will Moss, spokesperson for Motorola
Motorola employed around 3500 staff around the world when Lenovo purchased the company from Google last year, at a cost of $2.9 billion. Lenovo hasn’t stated how many more jobs are to be cut from Motorola, but it is possible that it is looking to slim down the company as it further integrates Motorola into its core business.
However, Lenovo has also stated that the Motorola brand will become the prime focus of its smartphone operations moving forward, with design, development and manufacturing duties all shifting over to the sub-brand. We will have to wait and see how these changes affect Motorola’s future smartphone product line-up.