The mobile sector will bear the brunt of the layoffs that comes a year after 18,000 jobs were cut due to a restructuring.
“Over the past few weeks, I’ve shared with you our mission, strategy, structure and culture”. Instead “Microsoft intends to focus its efforts in phones on three areas: business users, value customers and ‘flagship devices.'”. Most of the jobs that are being phased out over the next couple of months are related to the phone sector of the business. The layoffs are likely to take place over the next several months as the Tech Giant attempts to cut costs in an overly competitive market. In addition, Stephen Elop, who was overseeing the mobile phone business after it was acquired by Microsoft, also left the company.
The company, which had more than 118,000 employees worldwide as of March 31, said on Wednesday it would take a restructuring charge of about $750-$850 million in its fourth quarter ended June 30.
Microsoft is focusing in a broader reforming of the mobile business that incorporates cutting down at least 18000 employment cuts. In a statement, he said, “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”. Microsoft closed its $7.2 billion deal for Nokia in April 2014.
The company has been planning the job cuts since a year ago, when Satya Nadella became its chief executive officer.
Microsoft smartphone business is being restructured, which is not a surprise.
Microsoft also confirmed that it is selling a part of its mapping unit to Uber, the multimillion dollar cab company, while Uber is expected to offer jobs to 100 Microsoft employees.
Windows 10 for mobile devices is scheduled for a release late this year, although it will not receive a simultaneously launch alongside the desktop and tablet version of Windows 10.
As it stands Microsoft doesn’t have many big hitters producing Windows Phones (90% of Windows Phones are Lumias), and it would be hard to see Microsoft doing anything other than gradually calling it a day in this department. The stock closed at $44.24 on Wednesday and the company has a market cap of $356 billion.