Menu
Microsoft pulls back from phone business, announces 7800 layoffs

Microsoft pulls back from phone business, announces 7800 layoffs

Microsoft will write off the entire value of the smartphone business it acquired from Nokia

Microsoft is scaling down its mobile phone activities, writing off the entire value of the former Nokia smartphone business it bought last year and laying off almost one-third of that business' staff.

The company will no longer try to build a standalone phone business, but instead plans to build a Windows ecosystem that includes its own devices, CEO Satya Nadella told staff in an email announcing the changes.

Up to 7800 jobs will be cut, most of them in the phone business. The cuts come in addition to 18,000 layoffs announced last year: Those cuts included around half of the 25,000 staff who joined Microsoft from Nokia.

Microsoft also announced plans to write down the value of its Nokia acquisition, recording an impairment charge of $US7.6 billion. It bought the Finnish company's devices and services business only last year for $7.2 billion.

The company explained the write-down by saying that it's restructuring of the phone business meant that its future prospects were below original expectations. Its Lumia phones are languishing with a single-digit market share, and the company has produced no break-out successes to rival flagship phones from Samsung Electronics or Apple.

The layoffs should happen by year end, Microsoft said, adding that it would provide more information about the impairment charge in its fourth-quarter earnings announcement on July 21.

Peter Sayer covers general technology breaking news for IDG News Service, with a special interest in open source software and related European intellectual property legislation. Send comments and news tips to Peter at peter_sayer@idg.com.


Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Tags business issuespersonnelconsumer electronicsMicrosoftsmartphones

Featured

Slideshows

Sizing up the NZ security spectrum - Where's the channel sweet spot?

Sizing up the NZ security spectrum - Where's the channel sweet spot?

From new extortion schemes, outside threats and rising cyber attacks, the art of securing the enterprise has seldom been so complex or challenging. With distance no longer a viable defence, Kiwi businesses are fighting to stay ahead of the security curve. In total, 28 per cent of local businesses faced a cyber attack last year, with the number in New Zealand set to rise in 2017. Yet amidst the sensationalism, media headlines and ongoing high profile breaches, confusion floods the channel, as partners seek strategic methods to combat rising sophistication from attackers. In sizing up the security spectrum, this Reseller News roundtable - in association with F5 Networks, Kaspersky Lab, Tech Data, Sophos and SonicWall - assessed where the channel sweet spot is within the New Zealand channel. Photos by Maria Stefina.

Sizing up the NZ security spectrum - Where's the channel sweet spot?
Kiwi channel comes together for another round of After Hours

Kiwi channel comes together for another round of After Hours

The channel came together for another round of After Hours, with a bumper crowd of distributors, vendors and partners descending on The Jefferson in Auckland. Photos by Maria Stefina.​

Kiwi channel comes together for another round of After Hours
Consegna comes to town with AWS cloud offerings launch in Auckland

Consegna comes to town with AWS cloud offerings launch in Auckland

Emerging start-up Consegna has officially launched its cloud offerings in the New Zealand market, through a kick-off event held at Seafarers Building in Auckland.​ Founded in June 2016, the Auckland-based business is backed by AWS and supported by a global team of cloud specialists, leveraging global managed services partnerships with Rackspace locally.

Consegna comes to town with AWS cloud offerings launch in Auckland
Show Comments