Microsoft announced on Wednesday its plans for another round of layoffs — this time, cutting 7,800 jobs held by employees in the Windows Phone business.
The layoffs are part of the company's attempt to restructure its phone hardware business, given that its smartphone sales have been struggling following its $7.2 billion acquisition of Nokia last year. The company will record an impairment charge of about $7.6 billion related to the assets associated with the acquisition, as well as a restructuring charge of between $750 to $850 million.
In spite of its smartphone hardship, the company has no plans to give up on the Windows Phone, and still has plans to release Lumia phones. The job cuts do reflect the company's need to reduce costs on its devices, especially when focusing on Windows 10 first-party hardware.
Microsoft's operating system Windows 10 for its smartphones and tablets will be released later this year.
"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 Microsoft CEO Satya Nadella in an email to employees. "In the near-term, we'll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility."
The company's plans should come as no surprise, as Microsoft announced its plans to cut 18,000 jobs a year ago. And the layoffs have been occurring in waves. Last year, 12,5000 Nokia employees lost their jobs, and other jobs not related to the phone business have seen cuts as well, such as Microsoft Research, human resources, sales and marketing, IT and the company's Operating System Group.
Last month, Microsoft decided to shift the display advertising business over to AOL, and plans to transfer its imagery acquisition operations to Uber.
Photo: Kārlis Dambrāns | Flickr
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