Microsoft CEO Satya Nadella Stephen Lam, Getty Images

Microsoft CEO Satya Nadella.

Microsoft Cuts 7,800 Jobs, Reorganizes Phone Unit

With little more than 3% of the global smartphone market share, Microsoft shakes up its phone division and executes its second round of layoffs in the last year.

Microsoft announced plans on Wednesday to cut 7,800 jobs and reorganize its Windows Phone unit, which has struggled in the mobile market.

The move represents the second major round of layoffs in a year for Microsoft, which cut some 18,000 jobs a year ago as part of its effort to integrate the Nokia handset division.

Most of the cuts at the U.S. tech giant will be in the phone division, and the company will write down the value of its phone business acquired from Nokia by some $7.6 billion.

A Microsoft statement said it would “restructure the company’s phone hardware business to better focus and align resources.”

Microsoft has failed to get much traction for its Windows Phone platform even with the acquisition of Nokia. A survey by IDC said Windows was expected to capture just 3.2% of the global smartphone market this year.

“I am committed to our first-party devices including phones. However, we need to focus our phone efforts in the near term while driving reinvention,” CEO Satya Nadella wrote in a memo to staff. “We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem that includes our first-party device family.”

Microsoft had about 118,000 employees worldwide at the end of March, according to its website, with about half in the United States.

Microsoft plans to start rolling out Windows 10 in late July, introducing a new operating system that can be used to power not only personal computers but a whole range of mobile devices.

While it still dominates the market for personal computers, Microsoft has struggled in the market for mobile devices, the majority of which are powered by the Google Android system or Apple’s iOS.

Last month, Microsoft announced a shakeup of top management, including the departure of Stephen Elop, the former Nokia chief who came on board with Microsoft’s acquisition of the Finnish firm’s handset unit.

Copyright Agence France-Presse, 2015

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