Chinese Lenovo Group Ltd announced on Thursday an impending dismissal of 10 % of office workers amid falling sales of Motorola handsets with a third, which casts doubt on the company's decision to make a bid for the loss-making brand, bought for nearly $ 3 billion in the hope of becoming a global leader in the mobile phone market.
The world's largest PC maker said on Thursday that its quarterly net profit fell 51 % to $ 105 million, while analysts expected a decline of 59 %.
The revenue rose 3 % to $ 10.7 billion, which is less than consensus forecast of $ 11.29 billion.
In addition, Lenovo announced plans to cut about 3200 job positions in the non-manufacturing sector.
After this news the company shares fell on Thursday by more than 9 %, reaching the lowest level since February 2014.
Lenovo said that the restructuring will result in savings of $ 1.35 billion per year. But the problems with the sales of mobile phones, coupled with the ever-falling demand on the PC, means that the company expects "difficult conditions in the coming years," said its leader, Yang Yuanqing.
"I continue to believe that we have get positive results in the mobile business," - said Yang in a Reuters interview and confirmed that the company has not lost the desire to compete with the market leaders such as Apple Inc (NASDAQ: AAPL) and Samsung Electronics Co.
"I continue to believe that this acquisition (Motorola) was the right decision. Besides Apple and Samsung there is no third leader or global player. I believe that this will be Lenovo".
Lenovo bought Motorola from Google Inc (NASDAQ: GOOGL) last year for $ 2.91 billion. In the last quarter shipments of Motorola phones totaled 5.9 million units, which is 31 % less than last year.