Today, Microsoft hammered the final nail in the coffin of its ill-fated Nokia acquisition, announcing the sacking of nearly 2,000 employees.
Microsoft has confirmed that up to 1,850 people will be made redundant as the firm announces a “streamlining” – that’s cold, Microsoft – of its smartphone hardware business. This restructuring will cost Microsoft around $950 million, just over a fifth of which will relate to severance payments.
Microsoft bought Nokia’s Devices and Services business back in 2013 at a price of $7.1 billion in a bid to carve itself a share of the smartphone market. During that acquisition, Microsoft sacked 7,800 employees at a cost of $7.6 billion. Then, just last week, Microsoft announced that the feature phone segment of that business was being sold off for $350 million.
The new sackings will mostly affect Nokia’s home turf: 1,350 of the redundancies will be made at Microsoft Mobile Oy, headquartered in Finland. The remaining 500 affected staff are based “globally”.
Microsoft Lumia 950 XL
In a statement, Microsoft CEO Satya Nadella said:
“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. We will continue to innovate across devices and on our cloud services across all mobile platforms.”
It isn't clear how this will affect Microsoft just yet, although it suggests the company’s recent mobile push didn’t go as planned. The company’s new Windows 10 OS puts a heavy focus on integrating mobile and desktop, and even featured on the new flagship Microsoft Lumia 950 and 950 XL smartphones. However, it appears that phone sales weren’t up to par.
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Are you sad to hear about Microsoft’s new ‘streamlining’ efforts? Does it make sense? Let us know in the comments.