Microsoft set to cut nearly 8,000 jobs
Microsoft is cutting 7,800 jobs as it seeks to charge up its sluggish phone hardware business.
It is also writing off $7.6bn (£4.9bn) relating to its purchase of Nokia’s phone business last year.
The restructure is in addition to 18,000 job cuts the company announced last year.
Microsoft currently has more than 118,000 employees.
Chief executive Satya Nadella said a “fundamental restructuring” of its phone business lay ahead.
“I am committed to our first-party devices including phones,” Mr Nadella said in an email to staff .
“However, we need to focus our phone efforts in the near term while driving reinvention.”
The company paid $7.3bn (£4.7bn) in April 2014 for Nokia’s handset unit, but the deal left it with just 3% of the smartphone market.
Now Microsoft is writing off more than the entire cost of the Finnish acquisition in what is known as an “impairment charge”.
In addition, it is absorbing a $750m (£490m) to $850m (£550m) restructuring charge.
Microsoft’s Windows Phone system has struggled to take on Apple’s iOS and Google’s Android system.
The Nokia deal was sealed by Mr Nadella’s predecessor Steve Ballmer, who wanted to take on the iPhone.
Mr Ballmer famously laughed at Apple’s handset before its 2007 release.
“There’s no chance that the iPhone is going to get any significant market share,” he remarked at the time. “No chance.”