Motorola has confirmed that it is laying people in its Chicago office off, though it also says "our Moto Z family will continue." Prior to this announcement, multiple people close to the company have stated that a significant portion of Moto's engineering staff in Chicago has been laid off, with a Moto Mod owner going as far as saying the "Z team in Moto was irreversibly impacted." However, Motorola says that the Moto Z line will "continue."

An initial source came from user "Ex-Motorolan," who states that he/she is losing a dream job, on TheLayoff.com:

Motorola Mobility (Lenovo) just tapped 50% of their Chicago workforce on the shoulder to let them know they are being laid off. Their expected last day of work is April 6, 2018. Sad… and to think this was my dream job getting out of college.

This was compounded by Liangchen Chen, the owner of the Keyboard Mod for Moto Z devices. He responded to an Indiegogo backer who asked if the Moto Z line was being killed off with, "To be honest, it looks even worse than that..." Chen was initially hesitant to discuss the situation, saying "There has been some shocking news recently, I cannot tell publicly," though he did go on to claim that "the Z team in Moto was irreversibly impacted." Given that he's worked closely with Motorola for his upcoming Moto Mod, his words should be taken seriously. And when Ex-Motorolan's post on TheLayoff went live, he elaborated:

For anyone who missed the previous comment: This is what is going on: https://www.thelayoff.com/t/S3hHqqU We cannot move on to production until we finish OTA update server implementation with Moto’s side. And the above layoff has a huge impact on current situation and future. This is the most I can tell at this moment. We can’t help but waiting for everything to get clear.

Motorola responded to 9to5Google, essentially saying that less than half of the Chicago team was laid off, and that the Moto Z line will "continue." That's pretty ambiguous phrasing, but not unexpected for a statement of this nature. The comment is as follows:

In late 2017, Lenovo announced a worldwide resource action that would occur over the next several quarters, and impacting less than two percent of its global workforce. This week’s employment reductions are a continuation of that process. We are reducing our Motorola operations in Chicago however this did not impact half of our workforce there and our Moto Z family will continue.

Our own source close to Motorola has told us that 190 people have been laid off. Additionally, we're told that the company's current main goal is to simplify, pull out of markets where phones aren't selling, and focus on core markets and mods that will generate sales. As of right now, we don't know how Motorola's upcoming lineup --- you know, the one that was completely leaked in January --- will be affected, but chances are that we won't be hearing any positive news on this front.