In cutting its losses from the ill-fated acquisition, the company is taking a $950 million restructuring charge. The great bulk of the job cuts will come at Microsoft Mobile Oy in Finland.
Microsoft is shuttering the last major pieces of the phone hardware business it bought from Nokia, ending a two-year saga that saw the company badly stumble in an effort to challenge its Silicon Valley rivals in the smartphone business.
The most recent toll was announced Wednesday: up to 1,850 layoffs and a $950 million restructuring charge, $200 million of which is related to employee severance.
Since Microsoft’s purchase of Nokia handset business in April 2014, Microsoft has cumulatively laid off tens of thousands of employees at manufacturing plants and research facilities from Redmond to Finland to China.
The company’s financial losses, including soured bets on Nokia’s brand name, customer relationships, and the cost of cutting ties with facilities and personnel, total more than $10 billion in restructuring charges and writedowns.
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The company has little to show for the trouble. Windows software ran just 0.7 percent of the smartphones sold during the first three months of 2016, according to researcher Gartner.
The Google-controlled Android operating system ran 84 percent of the smartphones sold during the period, and Apple’s iOS powered 15 percent.
The bulk of the latest job cuts, 1,350, will fall on Microsoft Mobile Oy in Finland, the core of the Nokia Devices & Services business Microsoft spent more than $7 billion to acquire in 2014.
The remaining 500 layoffs will be spread across product groups and regions, a Microsoft spokesman said. He declined to say whether any of the layoffs would fall on the company’s Washington state presence.
Last week, Microsoft sold the feature-phone business it had acquired from Nokia to Taiwanese hardware maker Foxconn and a private-equity backed firm leasing the Nokia brand name.
Combined with Wednesday’s cuts, that means the only piece of the Nokia business Microsoft will continue to operate is a limited research and development facility in Espoo, Finland, a spokesman said.
Microsoft will continue to support its existing smartphone software, including the Windows 10 mobile variant, and will develop new smartphone hardware, Terry Myerson, the executive vice president in charge of the company’s Windows and Devices group, said in a memo to employees.
“We’re scaling back, but we’re not out,” he said. “We’ve done hard work and had great ideas, but have not always had the alignment needed across the company to make an impact.”
Myerson said the company will “be pragmatic and embrace other mobile platforms” with its software.