Microsoft to stop smartphone manufacturing, 1850 jobs could go

As an outcome of the latest layoff plans, Microsoft will set aside $200 million for severance fees and write down the value of its More Personal Computing business, resulting in a total charge of around $950 million, it said.

Microsoft plans to cut up to 1,850 jobs as it tries to move on from its failed efforts with Nokia and find a grip in the smartphone market.

Microsoft has repeatedly maintained that it is still committed to Windows 10 on mobile devices, and is reportedly working on new smartphones running the platform. After acquiring Nokia's phone business for $7.2 billion two years ago, Microsoft wrote off $7.6 billion last year and cut 7,800 jobs to refocus its phone efforts.

Microsoft is continuing its retreat from the mobile phone business with massive job cuts in its devices division.

In July 2015, Microsoft announced a $7.6bn adjustment on its Phone hardware business just 15 months after buying Nokia's mobile phone business for $7.2bn.

Since becoming chief executive officer in 2014, Satya Nadella has been gradually exiting a business championed by predecessor Steve Ballmer and had already written off most of the $9.5 billion Nokia acquisition.

These latest job cuts mean that most of the former Nokia employees will no longer be at Microsoft.

The United States company said it would shed up to 1,850 jobs, a lot of them in Finland, and write down US$950 million from the business. Another 500 will be spread around Microsoft offices in various global locations.

Nokia's mobile business acquisition would certainly go down as one of the costlier missteps in Microsoft's history. Mr. Nadella also said that the spirit of innovation across all mobile and cloud platforms will not dry out with this step.

"The writing has been on the wall for some time about Microsoft's remaining smartphone operations in Finland", said Ben Wood from the CCS Insight consultancy.

Redmond, Washington-based Microsoft expects to complete most of the announced actions by the end of 2016 with further details to be released with fourth-quarter earnings in July. By comparison, Android and Apple had 84 percent and 15 percent of the market respectively.

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