Microsoft has now confirmed rumors that it plans to lay off 7,800 employees, most of which will come from its phone division.
These new workforce reductions are in addition to the 18,000 Microsoft employees that were laid off in the past 12 months. Microsoft also announced it would record a one time impairment charge of $7.6 billion due to a write down of the company's acquisition of Nokia's Devices and Services division in 2014. There will also be a restructuring charge of approximately $750 million to $850 million. Microsoft stated:
"Microsoft will record a charge in the fourth quarter of fiscal 2015 for the impairment of assets and goodwill in its Phone Hardware segment, related to the NDS business. This charge has no impact on cash flow from operations and is nondeductible for income tax purposes. Based on the new plans, the future prospects for the Phone Hardware segment are below original expectations. Accordingly, the company concluded that an impairment adjustment of its Phone Hardware segment assets and goodwill of approximately $7.6 billion is required."
Microsoft expects that the majority of layoffs will be completed by the end of 2015, and all of them will have been made by the end of the company's current fiscal year, which ends on June 30, 2016.
Source: Microsoft{.nofollow}
