Google extends Motorola cuts; bumps charges to $340 million in Q3

Summary:The search giant warns in an SEC filing that further restructuring of its mobile making division in the third-quarter will result in charges up by 9 percent than previously thought.

Google has warned that Motorola Mobility continues to lose money and expects "significant" charges in the third-quarter in additional restructuring costs.

The search giant said it expects to incur further charges 9 percent higher than previously expected -- from $275 million to $300 million -- and warned that it could face an additional $90 million payout in other costs as part of the restructuring effort; though only $40 million will be paid in the third-quarter. 

In a 8-K/A filing with the U.S. Securities and Exchange Commission, Google's chief financial officer Patrick Pichette said:

Motorola has continued to refine its planned restructuring actions and now expects to broaden those actions to include additional geographic regions outside of the U.S.

Google bought Motorola Mobility for $12.5 billion last year as the search giant aimed to bolster its patent portfolio amid continued patent wars with its rivals, notably between Apple and Samsung, as a result of infringing patents found in Google's Android mobile operating system and Samsung's hardware.

But the wholly-owned subsidiary continues to haemorrhage money. Google said it would cut 20 percent of the division's workforce  -- approximately 4,000 people -- as the firm attempts to "return to profitability". Google will also close a third of Motorola Mobility's 94 offices worldwide.

Topics: Google, Smartphones, Tech Industry

About

Zack Whittaker writes for ZDNet, CNET, and CBS News. He is based in New York City.

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