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Motorola cuts 4,000 jobs
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March 23, 2001: 11:56 a.m. ET
Wireless equipment maker's continuing cost cutting to result in 1Q, 2Q charges
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NEW YORK (CNNfn) - Motorola Inc., the world's second-biggest maker of mobile phones, said Friday it was cutting another 4,000 jobs in a bid to stay competitive given the slowing U.S. economy and shrinking market for mobile phone equipment.
The latest cuts in Motorola's (MOT: Research, Estimates) work force are in addition to more than 16,000 announced since December, bringing the total cuts to about 23,000, as planned. The 4,000 jobs will be eliminated from its broadband and wireless operations and lead to charges against earnings in the first and second quarters, the company said.
Analysts had expected the company to post a first-quarter loss of 7 cents a share compared with earnings of 20 cents a share a year ago, and a second-quarter loss of a penny a share compared with earnings of 23 cents a share a year earlier, according to earnings tracker First Call.
 Analysts also expected the company to earn 15 cents a share for all of 2001.
Credit Suisse First Boston analyst Tim Long said he was not changing his outlook on the company based on Friday's announcement, adding the cost-cutting was positive for Motorola.
But Long does not see much improvement in the mobile phone business soon.
"We are not expecting a fundamental change to the industry. I think it likely there will be some economic impacts to the mobile phone markets this year," Long said, adding that he sees rival Nokia continuing to pull even further ahead by gaining more market share.
Cuts hit tech and other sectors
Motorola's is the latest in a string of job cuts at big companies, both in the tech sector and among "old economy" corporations. Sweden's Ericsson, the world's No. 1 supplier of mobile phone gear, is expected to outline a cost-cutting plan next week, including a hiring freeze.
Consumer products giant Procter & Gamble (PG: Research, Estimates) said Thursday it was slashing 9,600 jobs as it struggles with sluggish sales and stiff competition.
Motorola said plans for the job eliminations should be complete by the end of the second quarter, but the actual implementation of cuts depends on legal and regulatory requirements in various countries.
"Motorola is making tough, but deliberate and strategic, business decisions in order to remain competitive in the slowing economy," Edward Breen, Motorola's networks sector president said. "Unfortunately, reductions have been necessary for us to improve financial performance, and this is something that we will have to continually evaluate as we monitor market and economic conditions."
Check out other wireless stocks
In February, Motorola warned it would fall short of first-quarter sales and earnings forecasts and that it would either shutter or cutback four of its 50 plants as it struggles with declining demand and steeper competition from the likes of Finland's Nokia (NOK: Research, Estimates), which overtook it as the No. 1 mobile phone supplier nearly three years ago.
Motorola's stock gained 18 cents to $15.86 in early trading Friday. 
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