Microsoft is planning to cut nearly 3,000 more jobs globally in a continuation of its move to streamline its smartphone hardware business.
According to a 10-K form filed with the SEC on Thursday, Microsoft will cut another 2,850 positions through the end of the year, primarily in its mobile division.
“We periodically evaluate how to best deploy the company’s resources,” Microsoft wrote in the filing. “These actions are expected to be completed by the end of fiscal year 2017.”
The cuts will come on top of the elimination of 1,850 positions in May, 1,350 of which came from Microsoft Mobile Oy. In June 2015, Microsoft also cut 7,400 jobs, primarily from its Phone Hardware business, as part of a restructuring plan.
The move follows Microsoft’s decision to sell “substantially all” of its feature phone assets to FIH Mobile and HMD Global in May. Microsoft said approximately 4,500 of its employees will be given the opportunity to transfer to FIH or HMD at the close of the deal in the second half of this year.
As of June 30, 2016, Microsoft said it had approximately 114,000 full-time employees, including 63,000 in the United States and 51,000 internationally. Those figures marked a substantial shift from the company’s June 2015 report of 118,000 full-time employees, with 60,000 in the United States and 58,000 abroad.
Microsoft’s phone business has been struggling for some time.
Back in April, Microsoft said Lumia sales plummeted more than 70 percent year-over-year in its third fiscal quarter to just 2.3 million. Sales of other phones also dropped off from 24.7 million in 2015 to just 15.7 million in the third fiscal quarter. Accordingly, phone revenue dipped 47 percent, dragging down overall device revenue by 11 percent.
Phone revenue continued its free fall in the company’s fourth fiscal quarter ended in June, dropping 71 percent year over year. Device revenue also tumbled by 35 percent in the most recent quarter.
Despite the sale of its phone assets, however, Microsoft said in May it would continue to develop Windows 10 Mobile and support Lumia phones such as the Lumia 650, Lumia 950 and Lumia 950 XL, and phones from OEM partners like Acer, Alcatel, HP, Trinity and VAIO. Whether or not the new cuts will impact this promise remains to be seen.
Filed Under: Devices
