Microsoft hangs up on smartphone workers

Although Microsoft indicated it would continue to develop the Windows 10 platform and support its Lumia smartphones, the firm's chief shop steward in Finland, Kalle Kiili, said Microsoft would no longer produce new phones. Employees working for Microsoft Oy, a separate Microsoft sales subsidiary based in Espoo, are not in scope for the planned reductions.

The company's stock was up more than 1.5 percent after the announcement Wednesday. As a result of the action, Microsoft will record a charge in the fourth quarter of fiscal 2016 for the impairment of assets in its More Personal Computing segment, related to these phone decisions.

The move comes just two years after the United States company paid $7.2bn for Nokia's handset business. However, the deal never seemed to provide the much-needed fuel for Microsoft to catch market Apple and Google, who both lead the market with their iOS and Android devices.

Nearly a year ago, Nadella had announced a "more effective and focused phone portfolio" with business, value phones and flagships gaining prominance.

Terry Myerson shows off the Uber app on a Windows Phone device in this 2014 Microsoft photo. Earlier this month, it agreed to sell its feature phones business to a new Finish company HMD Global and Foxconn Technology Group from Taiwan for $350 million. That was a year after it splashed out $7.2bn on Nokia's phone business.

Microsoft's embattled phone business looks in deep trouble as it announced a whopping 1850 job cuts and an associated $950m write-off. Microsoft's overall bottom line continues to benefit from its cloud-first strategy.

But that phone business is drastically pared back from two years ago. Microsoft acquired Nokia's handset business in hope of catching up, which gave the software giant a hardware maker committed to using its operating system. Today Microsoft said that due to the customer feedback it had received it will add another notification after users try and get rid of the dialogue by pressing the close gadget, providing "an additional opportunity for cancelling the upgrade".

Meanwhile, watch for Nokia-branded phones to make their way back to the market through the companies that just bought those assets from Microsoft.

Source: Microsoft hangs up on smartphone workers