Microsoft Confirms Major Job Cuts

Microsoft has confirmed significant job cuts after reports earlier this morning suggested a cull was imminent.

The company has released a statement announcing a ‘restructuring’ that will see 7,800 jobs lost

Microsoft’s phone business will be hit the hardest, with the company writing off $7.6 billion (£4.9bn) in assets relating to its takeover of Nokia’s devices arm in 2013 – a deal which at the time was only valued at £4.6 billion

Device family

Microsoft CEO Satya Nadella broke the news in an email to employees.

“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,” he said. “In the near-term, we’ll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility.”

The asset write-down will also incur a restructuring charge of approximately $750 million to $850 million, with more information to be revealed on Microsoft’s next earnings call on July 21.

Microsoft’s 118,000 employees had already been decimated this time last year, when 18,000 workers lost their jobs as part of Nadella’s drive to “realign our workforce”.

The restructuring has impacted all levels of Redmond, with former Nokia CEO Stephen Elop the highest profile casuality of a management shakeup.

Many of the workers may well be tempted back to Nokia, which appeared to hint last month that it could be considering a return to the handset industry. CEO Rajeev Suri told a German magazine that the company wants to design and licence smartphones with third parties, but won’t return to manufacturing.

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