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Microsoft has just announced that they are increasing the number of employees that they will be terminating in the coming months. From 1,850 that was announced back in May, the tech company will now be axing 2,850 people. This makes the total of worldwide terminations by Microsoft to about 4,700.
Microsoft has been hitting some rough patches recently, and it seems that the casualties are now in the thousands. According to Fortune, details from the company’s own 10-K filing revealed the number of people that they have decided to terminate. Predictably, the termination will mostly focus on the smartphone sector of the company.
Microsoft acquired the smartphone arm of Nokia Corporations after the company decided to exit the industry, and Bill Gate’s enterprise has suffered ever since. After shelling out $7.6 billion for the acquisition in 2014, Microsoft has failed at every turn to break into the market in any appreciable manner. As a result, sales of their “Windows Phone” lineup have been in decline steadily, without any signs of slowing down.
In June 2015, Microsoft announced that 7,400 people in its smartphone sector will be losing their jobs. In addition, a $7.6 billion impairment charge would be recorded. This is hardly surprising, as Nokia’s smartphone arm was already in the tank at the time and nobody was really even excited for “Windows Phones.” With the acquisition going at such a high price, Microsoft was placed in a difficult position, which no one was betting they could get out of.
PC World noted the biggest source of the problem had to do with the current CEO, Satya Nadella, who did not express as much enthusiasm about the smartphone market as the former CEO did. At the time of the acquisition, Steve Ballmer was at the top of Microsoft’s executive ladder and he was the one who actually believed in the company’s ability to compete with brands like Apple and Samsung.
By leaving Microsoft, Ballmer practically took the company’s chances of making a mark in the smartphone market with him.
