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Microsoft cuts thousands of jobs anew

Posted: 09 Jul 2015     Print Version  Bookmark and Share

Keywords:job cut  restructuring  impairment charge  workforce 

Microsoft announced another round of cuts in its workforce and more than $7 billion of impairment charge related to its buyout of Nokia's devices and services as part of the 40-year-old company's restructuring of its phone hardware business, Forbes said in a report.

The move is in line with Microsoft's hope to "better focus and align resources," which will lead to a more useful phone portfolio with better products and faster time to market. In addition, the company plans to concentrate on three customer segments, which it did not disclose.

Both the restructuring and the refocusing steered Microsoft to eventually cut 7,800 positions across its offices around the world, which will be felt over the next few months. The said cut will largely happen in the company's phone business.

In an email to employees obtained by Forbes, Microsoft CEO Satya Nadella said, "We are moving from a strategy to grow a stand-alone phone business to a strategy to grow and create a vibrant Windows ecosystem including our first-party device family... In the near term, we'll run a more effective and focused portfolio while retaining capability for long-term reinvention in mobility."

After taking over for Steve Ballmer as the company's head, Nadella made it as centre of his leadership to make Microsoft cloud-first and mobile-first.

Apart from the global workforce downsizing, Microsoft said it would also take a $7.6-billion impairment charge in relation to its Nokia acquisition. Microsoft bought the phone company in 2014 for $7.2 billion. It will also have to write down a restructuring charge of about $750 million to $850 million.

More information will be given later this month when the company releases its fourth quarter earnings results.

Last year, Microsoft announced that it would reduce its workforce by 14 per cent or 18,000 jobs, adding that 12,500 of the affected positions would come from its phone business. The 7,800 job cuts that will take effect in the coming months add up to this count.

Microsoft is also planning to sell its mapping business to Uber, while continuously sourcing imagery and maps to its partners.

- Stephen Padilla
  EE Times India

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