STATES CHRONICLE – Reportedly, 2,850 Microsoft employees from its smartphone and sales units will be laid off globally over the next 12 months. Earlier this year, the tech giant slashed 1,850 more positions within the struggling mobile division.
In Europe, the company announced earlier this spring about 1,350 cuts because of a plan to revamp its smartphone hardware division. That move also affected 500 more jobs worldwide. The European smartphone sales unit, which is based in Finland, was not impacted by the decision.
The latest lay-offs are also part of a larger plan to streamline mobile and sales business worldwide. According to a June report, Microsoft had 63,000 employees in the U.S. and 51,000 more overseas.
About 38,000 Microsoft employees work in technical support, distribution and manufacturing businesses, 37,000 work in R&D divisions, 29,000 are sales representatives, and 10,000 more are working in administration.
Last summer, MS chief executive Satya Nadella said that the company was about to dump 7,000 employees worldwide. Nadella tied the job cuts to huge loses in the smartphone sector as Nokia Devices and Services business proved less profitable than expected and cost Microsoft $7.6 billion. Moreover, the company hemorrhaged up to $850 million as restructuring costs during the same time period.
Windows Phone is not faring too well. In the first quarter, it had just 2.54 percent market share heavily lagging behind Android’s 61 percent and Apple’s 31.76 percent. Last year, during the same quarter Windows phone had no more than 2.57 percent slice of the smartphone market.
The figures are all the more concerning as the tech giant launched Windows 10 in the meantime and gave the handset a long-awaited reset.
In April, during an annual developer conference, Microsoft’s Terry Myerson said that the struggling smartphone is no longer a priority. Myerson said that developers should better focus on more profitable products such as Windows 10, Xbox and Hololens.
“If you wanted to reach a lot of phone customers, Windows Phone isn’t the way to do it,”
He added that Xbox and Hololens are more exciting topics to have a discussion on than the Windows Phone. The Windows boss’ statements may mean that the company has admitted defeat in the war against Apple and other smartphone giants.
So, apparently the company won’t invest more resources in the failing business until it finds a way to lure in more customers.
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