Microsoft Corporation To Cut Thousands Of Jobs In Smartphone Division, Sales

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Microsoft is planning to cut almost 3,000 more jobs over the next year across its phone-manufacturing business and worldwide sales force as the company continues to step back from the smartphone market.

According to a report from Business Insider, a report filed by Microsoft with the U.S. Securities and Exchange Commission revealed that the layoffs come in addition to the 1,850 jobs the company stated it was cutting two months previous. The majority of these jobs were in Finland at what was once the world headquarters of Nokia, which Microsoft acquired 19 months ago.

Microsoft’s future in mobile not so bright

Microsoft has described this most recent round of layoffs as “an extension of the earlier plan,” and continued to detail that these layoffs would be completed by the end of the company’s fiscal year in 2017.

Earlier this month, Microsoft reported a drop of 71 percent in phone revenue in the latest quarter. Microsoft has struggled for years to gain traction in the smartphone market. Last year alone, the software giant announced plans to cut roughly 7,800 jobs primarily from its phone sector, and suffered a $7.6 billion write-down related to its 2014 acquisition of Nokia, for which it paid $7.2 billion.

Microsoft’s outlook on its smartphone industry, if these facts are any indicators, does not seem promising. Microsoft may have given up hope of ever becoming a major smartphone vendor or mobile operating system provider.

After reporting a 73 percent drop in sales of its Lumia smartphone during the first quarter of 2016, the company essentially ignored addressing any sort of mobile- or smartphone-related topics during its Build Developer’s Conference last March. Additionally, the company cut as many as 1,400 jobs in Finland and up to 500 jobs globally as it continued to step away from the smartphone industry.

Not quite out of the game

Microsoft hasn’t completely given up on mobile platforms just yet, as evidenced by its recent move to acquire LinkedIn last month for $26.2 billion. The business-centered social network grew nearly 50 percent in mobile usage in the past year, and now more than 60 percent of its traffic occurs on smartphones and tablets.

Microsoft will most likely continue to operate in the mobile operating system market for a while more, as rumors suggest that the company is currently developing a Surface phone. Despite this, the company does seem to be finally acknowledging that most of its cloud-based business will be driven by users on phone running Android or iOS.

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