The company's previous chief executive, Steven A. Ballmer, made the deal with the goal of transforming Microsoft, a company that was struggling to keep pace with the likes of Apple and Google in the mobile business.
It's the second shoe to drop.
As per to the Microsoft, it said that it would cut off to 1,850 jobs, in a move that clearly puts the stamp of two year chief executive Satya Nadella on the U.S. company. Instead, it is working to adapt its software and services to the Android and iOS platforms, rather than trying to get consumers to buy Windows phones.
Microsoft said in a statement that it would continue to develop the Windows 10 platform and support its Lumia smartphones, but gave no comment on whether it would develop new Windows phones.
Last week, Microsoft confirmed it is selling its feature phone business to Finnish company HMD and Foxconn subsidiary FIH Mobile for $350 million.
The company says its Microsoft Mobile Oy manufacturing wing in Finland will be hit hardest, with around 1,350 jobs due to be cut in the region.
Less than two years ago, then-new Microsoft CEO Satya Nadella announced an initiative to cut up to 18,000 jobs in an effort to make the business more efficient.
The restructuring will result in a one-time charge of $950 million which includes roughly $200 million for severance payments.
Under Nadella, Microsoft has been trying to refocus its efforts on areas such as cloud computing while cutting back on other areas like devices and services. There will also be up to 500 additional jobs trimmed worldwide. While Microsoft is yet to officially release a statement about its latest move, some tech analysts consider it the final nail in a coffin that contains Microsoft's mobile dreams. "From a partner perspective, I don't understand Microsoft's reluctance to admit that their Windows Mobile strategy has failed to gain traction".
Windows phones had less than 1 percent of the global smartphone market in the first quarter on sales of 2.4 million units, according to research firm Gartner.
Kagan pointed out that even with a mobile market share of 4 percent or 5 percent, Microsoft was in better shape than many competitors who haven't been able to break even.
Source: Windows Phone Woes Prompt Microsoft Layoffs
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