The Lenovo Group said it expects a loss for its latest quarter and will lay off 11% of its work force and cut executive pay. Lenovo said it will eliminate about 2500 jobs worldwide, including some management positions. It said executive compensation would be cut by 30% to 50%.
"As hard as this news is for all of our Lenovo employees, we believe the steps we are taking today are necessary for Lenovo to compete in today's economy," Chief Executive William J. Amelio said in a statement.
Lenovo said it expects to save about $300 million in the fiscal year ending March 31, 2010, due to its restructuring. But it said it anticipates it a pretax charge of about $150 million, the bulk of which will be taken in its fiscal fourth quarter. The company said it expects to report a loss for the three months ending Dec. 31, 2008.
In addition, Lenovo said it is consolidating its Asia-Pacific and China operations into a single business unit. The company said the restructuring will eliminate duplication and cut expenses.
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