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Job cut fears at Microsoft UK

James Pearce
June 13, 2016

Sources claim staff numbers in its handset team could fall from 40 to 10

Microsoft is set to axe three quarters of its UK handset team as part of a global restructure, Mobile News understands.

Last month, Microsoft CEO Satya Nadella announced plans to cut up to 1,850 jobs from its smartphone division, the majority of which will come from Finland, but a source close to the manufacturer revealed 30 of 40 UK roles will be axed.

The majority of these employees are based at Microsoft’s Reading campus, the source added.

“Microsoft are massively down-scaling their handset team in the UK and it has left a lot of people angry,” sources close to Microsoft explained.

“They will be cutting the team from around 40 people down to just 10 because they are losing money on the business.

“Microsoft are focusing on cloud and software, that’s where they really see the future. It’s understandably had a negative impact on morale for the staff. It’s a very sad situation for those involved and not something you would expect from such a leading player.”

It is the latest in a series of job cuts at the manufacturer following its $9.5 billion acquisition of Nokia in 2014. Last July, it announced plans to axe as many as 7,800 roles and write down the business by $7.6 billion. It also sold its feature phone unit for £240 million last month.

Market share concerns
Windows Phones had less than one per cent of global smartphone market share in the first quarter, compared with 84 per cent for Android and 15 per cent for iOS. In the UK, it held a market share of 6.2 per cent in the three months ending March 30, according to Kantar WorldPanel, down from eight per cent in the same period in 2015.

Microsoft said it will release more information with its fourth-quarter financial results, due next month (July), but most of the cuts are expected to be completed by the end of the year. At the end of last year, Microsoft had 112,689 staff globally.

Announcing the cuts last month, Nadella said: “We are focusing our phone efforts where we have differentiation.

“We will continue to innovate across devices and on our cloud services across all mobile platforms.”

Microsoft refused to comment on job cuts in the UK.

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