Google's layoffs in Motorola to set it back $275 million for "generous severance packages"

Google's layoffs in Motorola to set it back $275 million for "generous severance packages"
As it turned out yesterday, Google's purported hands-off approach at Motorola continued only until the deal went through with all the authorities involved, and now the search giant is getting down to business.

Right off the bat it is slashing 4, 000 jobs across the board, and rumors are that more cuts will follow in departments Google deems unnecessary for the core function of Moto, and it is producing smartphones, as the tablet business is allegedly also getting the ax at some point, while Motorola will be concentrating on fewer but more focused handsets.

These layoffs are projected to cost Google no less than $275 million, as SEC filings revealed yesterday, sending Motorola's employees out with well-padded severance packages. Google said it will recognize those layoff charges in the third quarter financial results, and investors might see tumultuous revenue streams at Moto for several quarters after, until Google clears up its strategy what to do with the phone maker besides using it as a patent litigation shield:

Google's shares were up almost 3% yesterday with a down market, as stock prices usually react on such broad layoffs that result in significant cost-cutting in the employee compensation pool.

source: SEC


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