Arris Slashes Headcount - Analyst Blog

By
A A A

Arris Enterprises Inc. ( ARRS ), a leading video and broadband gear manufacturer, recently retrenched about 700 employees, which accounts for around 7% of its total workforce. The company is restructuring its business model, after acquiring the Home businesses of Motorola Mobility, a subsidiary of Google Inc. ( GOOG ).

This was necessary after the acquisition was made in April 2013. The merged entity is expected to generate a cost synergy of $100 - $125 million per annum.

From the second quarter of 2013, Arris will report in two business segments instead of the current three business segments. The new segments will be Network & Cloud and CPE (Customer Premises Equipments). The Network & Cloud segment will include Arris' existing CMTS EMP, Access, Transport & Supplies, Media & Communication Systems products.

This segment will also include Arris' Home, Video, head-end, CMTS and the converged products. On the other hand, the CPE segment will comprise Cable and DSL modems, EMTAs, gateways and set-top boxes of both Arris and Motorola Mobility.

With Motorola Mobility's Cable Home business in its portfolio, Arris is likely to become a formidable player in the video infrastructure and CPE for the cable TV industry. A report of Infonetics Research Inc. stated that the combined Arris/Motorola constituted 45% of the DOCSIS 3.0 CPE market share in 2012. This figure is well above the second-ranked Cisco System Inc. 's ( CSCO ) 15% market share.

Last month, Arris received a boost from its largest customer, Comcast Corp. ( CMCSA ) as the latter has started commercially deploying the company's E6000 Converged Edged Router. Furthermore, Comcast will be launching Arris' XG1 gateway for its innovative X1 TV service from the third quarter of 2013. Arris currently has a Zacks Rank #3 (Hold).



ARRIS GROUP INC (ARRS): Free Stock Analysis Report

COMCAST CORP A (CMCSA): Free Stock Analysis Report

CISCO SYSTEMS (CSCO): Free Stock Analysis Report

GOOGLE INC-CL A (GOOG): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ARRS , CMCSA , CSCO , GOOG

Zacks.com

Zacks.com

More from Zacks.com:

Related Videos

Lies Retailers Tell
Lies Retailers Tell                 

Stocks

Referenced

Most Active by Volume

6,276,594
  • $42.13 ▲ 4.85%
2,777,566
  • $16.585 ▼ 0.09%
2,410,247
  • $102.63 ▲ 0.16%
1,790,801
  • $96.95 ▲ 0.08%
1,728,091
  • $40.19 ▼ 1.20%
1,648,570
  • $7.081 ▼ 11.71%
1,495,773
  • $45.0399 ▲ 0.36%
1,485,807
  • $92.5399 ▲ 1.80%
As of 10/22/2014, 09:35 AM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com