Microsoft's Nokia gamble didn't pay off, 7,800 jobs cut

Microsoft HQ

Microsoft has announced that it is cutting 7,800 jobs and writing off $7.6 billion (around £4.95 billion, or AU$10.2 billion) related to its acquisition of Nokia.

Rumors were already flying earlier today that a raft of job cuts were coming and that the phone business is where the brunt of the positions will be lost.

"We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem including our first-party device family. In the near-term, we'll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility," said Microsoft CEO Satya Nadella in an email to employees quoted by The Verge.

In March, Microsoft had more than 118,000 employees worldwide, despite the 18,000 people that it handed pink slips to the previous year.

The latest round of cuts come just weeks after Stephen Elop, former chief executive of Nokia and high-level Microsoft executive, departed. Nadella then appointed Terry Myerson, an ideological companion, as head of the Windows and Devices group.

All about Windows 10

Myerson's job is among the most important across the entire company given how important Windows 10 will be to the whole firm's strategy when the operating system is finally released later this month.

It's not just jobs that have been lost. Microsoft is also writing off some $7.6 billion (around £4.95 billion, or AU$10.2 billion) from the deal it made for Nokia last year, something that only actually cost Microsoft $7.2 billion (around £4.69 billion, or AU$9.69 billion).