Microsoft to slash 1,850 jobs as it ends Nokia experiment
Microsoft is cutting hundreds of jobs, mostly in Nokia's home country of Finland
Two years ago Microsoft acquired Nokia for $7.2bn, but Microsoft has officially announced its plans to cut its smartphone hardware division.
The company announced it will be cutting 1,850 jobs, with 1,350 jobs from its Microsoft Mobile Oy division based in Finland and the remaining 500 jobs spread across the globe. However, employees working for the Microsoft Oy division in Espoo are not involved in the restructure.
Furthermore, Microsoft is writing off $950m due to its restructure charge and it will take $200m of that which will go towards severance payments for affected employees. Microsoft also aims to complete most of the job cuts by the end of the year, however a small number of employees will remain in research and development roles.
It would appear that this move is Microsoft's way of cutting its ties to its Nokia acquisition, which will now take the company out of the consumer phone business, but the company insists it is not out of the race completely.
In an apparent leaked memo from Windows chief Terry Myerson, he states Microsoft plans to scale back its smartphone business, he said: "We're scaling back, but we're not out!"
In addition, Microsoft will support other mobile platforms and also offer productivity services, device management services and development tools on other mobile devices.
Microsoft's CEO Sayta Nadella said in a statement: "We are focusing our phone efforts where we have differentiation - with enterprises that value security, manageability and our Continuum capability, and consumers who value the same. We will continue to innovate across devices and on our cloud services across all mobile platforms."
As of late, Microsoft has been undergoing a transformation, only last year the software company wrote off $7.6bn and cut 7,800 jobs to focus on phone efforts, as it planned to take on market leaders, Apple and Samsung. However after much speculation, Microsoft announced earlier this month that it is selling its feature phone business to FIH Mobile, a subsidiary of Foxconn and Finnish company HMD Global for $350m.
The deal will see Microsoft handing over the rights to use the Nokia brand, feature phone software services and customer contracts and supply agreements.