Motorola Mobility is planning to cut hundreds of jobs and rein costs as it prepares to complete its acquisition by Google. The mobile phone maker said in a regulatory filing that the reductions would cost it $31 million and the charge will show up in the current quarter's results. The pretax costs include $27 million in severance and $4 million for closing facilities ahead of the takeover, which was approved by the US Securities and Exchange Commission on October 24.
"Motorola Mobility continues to focus on improving its financial performance by taking actions to manage the company's costs," Jennifer Weyrauch-Erickson, a company spokeswoman said in a statement. The firm announced Q3 2011 financial results, beating analyst estimates as sales climbed 11 percent to $3.26 billion. The company still reported a $32 million net loss, but that's an improvement over the prior quarter's $56 million loss.
Motorola Mobility agreed to an acquisition by the search giant in August in a deal worth $12.5 billion. Google's CEO Larry Page said the company would use Motorola Mobility's more than 17,000 patents to protect Android supporters in licensing and legal disputes with rivals such as Apple and Microsoft.
During an interview at All Things Digital's AsiaD conference, Andy Rubin, senior vice president of mobile at Google, said that the company doesn't plan to get into the handset manufacturing business as a result of their planned acquisition. Rubin reinforced the fact that other Android manufacturers had nothing to worry about. Google would run Motorola as a separate entity and they would receive no special treatment as a result of the acquisition.