Microsoft has now officially announced the restructuring of its Smartphone Hardware business. Not only it confirms lay-off of 1850 ex-Nokia employees, as we reported earlier but also reveals that Microsoft will take a impairment of $950 million because of this.
Microsoft Corp. on Wednesday announced plans to streamline the company’s smartphone hardware business, which will impact up to 1,850 jobs. As a result, the company will record an impairment and restructuring charge of approximately $950 million, of which approximately $200 million will relate to severance payments.
Microsoft anticipates this will result in the reduction of up to 1,350 jobs at Microsoft Mobile Oy in Finland, as well as up to 500 additional jobs globally. Employees working for Microsoft Oy, a separate Microsoft sales subsidiary based in Espoo, are not in scope for the planned reductions.
CEO Satya Nadella has said that Microsoft will continue to innovate across devices and will focus their phone efforts where “we have differentiation”. This is in line with what he said in an interview some days ago, where Nadella has talked about using Continnum feature to create a new category of phones three years down the line.
“We are focusing our phone efforts where we have differentiation — with enterprises that value security, manageability and our Continuum capability, and consumers who value the same,” said Satya Nadella, chief executive officer of Microsoft. “We will continue to innovate across devices and on our cloud services across all mobile platforms.”