Microsoft to Cut Thousands Of Jobs, Write Down Nokia Phone Business
Microsoft said on Wednesday it would cut 7,800 jobs and write down about $7.6 billion related to its Nokia handset business, which it acquired in 2013. The reduction of up to 7,800 positions will be primarily in the phone business. Microsoft expects that the reductions will take place over the next several months. The move is part of the company's plan to restructure its phone hardware business to better focus and align resources.
"I am committed to our first-party devices including phones," Microsoft CEO Satya Nadella said. "However, we need to focus our phone efforts in the near term while driving reinvention. We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem that includes our first-party device family.
In the near term, Microsoft plans to run a more effective phone portfolio, with better products and speed to market given the recently formed Windows and Devices Group.
"We plan to narrow our focus to three customer segments where we can make unique contributions and where we can differentiate through the combination of our hardware and software. We?ll bring business customers the best management, security and productivity experiences they need; value phone buyers the communications services they want; and Windows fans the flagship devices they?ll love," Nadella added.
Today?s announcement follows recent moves by Microsoft to better align with company priorities, including recent changes to Microsoft?s engineering teams and leadership, plans to transfer the company?s imagery acquisition operations to Uber, and shifts in Microsoft?s display advertising business that enable the company to further invest in search as its core advertising technology and service.
"We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem including our first-party device family," Nadella said. "In the near-term, we?ll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility."
The latest round of job cuts is on top of the 18,000 job cuts the company announced last year.