Microsoft To Cut 1,850 Jobs From Its Hardware Business

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Microsoft appears to be in the final phase of shifting things in their mobile hardware efforts, as the company has put out an announcement today that details their plans for streamlining their hardware business for the future. As part of the changes, Microsoft notes that they will be cutting as much as 1,850 jobs in the process of moving forward with their new vision for hardware, and that 1,350 of those jobs will be from their Microsoft Mobile Oy division based in Finland while the remaining 500 jobs will be spread out across the globe. Microsoft also notes that employees who are working for Microsoft Oy which is a separate division based in Espoo, will be unaffected by the job cuts.

These changes essentially allow Microsoft to wash their hands of any of their previous Nokia phone business, of which they sold just last week for an amount of $350 million USD to FIH Mobile, which is a subsidiary of Foxconn. Microsoft's job cuts in Finland follow recent news that Nokia themselves are cutting up to 1,000 jobs in the region as well. The two instances are not one in the same, as Nokia's job cuts were part of a cost-cutting measure taken after they purchased Alcatel-Lucent.

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In addition to the job losses, Microsoft is recording a $950 million restructuring charge, and it will be taking around $200 million of that and using it for severance payouts for those who have been affected by the job cuts. Microsoft expects that the steps they have taken as part of the changes will be completed in its entirety by July of next year which is the end of their current fiscal year, but most job cuts will be complete by the end of 2016. These job cuts mean that the majority of former Nokia employees are no longer working for Microsoft's mobile phone division, and although Microsoft has been clear with their confirmation that they're scaling back on hardware, Microsoft's Terry Myerson mentions that this doesn't mean Microsoft is done with hardware. This could mean that they're looking towards a plan for bringing a Microsoft Surface phone to market, which was initially rumored as a possibility back at the end of January.