Microsoft to Slash 7,800 Jobs, Restructure Phone Biz

[cdmagurus.com]

Microsoft today announced significant job cuts and plans to restructure its mobile phone business unit. The company will eliminate 7,800 jobs, mostly from its phone business, and streamline its portfolio of smartphones. The company said it will record a charge of about $7.6 billion in assets related to the Nokia Devices and Services acquisition, as well as another $750 million to $850 million in restructuring charges. The company warned as recently as last month that it faced tough choices. It recently cut former Nokia executives and agreed to transfer some engineering employees and assets to Uber. "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," said Nadella in an email to Microsoft employees. "In the near-term, we'll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility. 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. In the longer term, Microsoft devices will spark innovation, create new categories and generate opportunity for the Windows ecosystem more broadly. Our reinvention will be centered on creating mobility of experiences across the entire device family including phones." Microsoft said the prospects for its smartphone business are below original expectations. The company expects the bulk of today's actions to be finalized before the end of 2015. The $7.6 billion write-down exceeds the $7.2 billion Microsoft spent to acquire Nokia in 2014.


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