Lenovo to cut 3,200 jobs as sales slide, profit tumbles

By News on the Net Toronto Sun —— Bio and Archives August 14, 2015

Comments | Print This | Subscribe | Email Us

BEIJING - China's Lenovo Group Ltd. will lay off 10% of white-collar staff after sales of Motorola handsets fell by a third, raising doubts over the personal computer giant's bet that a money-losing brand it bought for nearly US$3 billion will help it become a global smartphone leader.

Shares in the world's biggest maker of PCs slid nearly 9% on Thursday after it said its quarterly net profit was halved as its mobile division lost nearly $300 million. Lenovo, which uses the U.S. dollar in operations rather than the recently devalued Chinese yuan, said it plans to cut about 3,200 non-manufacturing jobs with a one-time cost of $600 million. Beijing-based Lenovo said the restructuring would yield savings of about $1.35 billion on an annual basis. But the difficulty in selling handsets, combined with a continuously shrinking global market for PCs, meant the firm was facing its "toughest market environment in recent years," chief executive Yang Yuanqing warned. More...