The company announced Wednesday morning that almost 7,800 people will be laid off globally, mainly in the smartphone hardware business.
The staff cuts will sum up to about 7% of Microsoft’s employees. At the end of March the company had 118,600 employees, 60,000 of those being employed within the U.S.
This will be Nadella’s second major restructuring effort within the last year. Following the software giant’s acquisition of Nokia, he announced 18,000 layoffs in Nokia’s devices and services business last year.
This restructuring means a $7.6 billion write-down for the company; however, this one-time charge had been expected by many analysts.
Nadella made it very apparent after he took over Microsoft that aggressive changes to revitalize the company would be a necessity. Currently, the company’s focus is on cloud services and mobile software.
“We are moving from a strategy to grow a standalone phone business to grow and create a vibrant Windows ecosystem,” Nadella said in Wednesday’s announcement. “In the near-term, we’ll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility.”
Finland is the most affected by the latest cuts because many of Nokia’s employees are staffed there.
Pekka Pekkala, the communications head for the country’s prime minister, tweeted that 66% of Microsoft’s Finland staff will be dismissed.