Microsoft Restructuring Details Are In: $7.6 Billion Charge, 8,000 Jobs Cut

on Wednesday

which primarily focus on its phone hardware business to "better focus and align resources." As part of the restructuring, Microsoft will record an impairment charge of $7.6 billion related to assets associated with its acquisition of Nokia Devices and Services (NDS) business. The company noted that future prospects for its phone segment "are below original expectations." The charge will be recorded in the fourth quarter for the "impairment of assets and goodwill" related to the NDS business and will have no impact on cash flow from operations. The company also announced the reduction of up to 7,800 positions, primarily within the phone business that has struggled to gain meaningful market share against Android and iPhone operating systems. "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," Microsoft's CEO Satya Nadella told employees in an e-mail. "In the near-term, we'll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility." Shares opened up about 1 percent higher and traded recently at $44.48, up 0.4 percent. The company's press release noted that its restructuring will "better align with company priorities" which include changes to the company's engineering teams and leadership, plans to transfer its imagery acquisition operations to Uber, and shifts within the company's display advertising business to better capitalize in search as its core advertising technology and service. Microsoft expects these restructuring initiatives to be "substantially" completed by the end of the calendar year and "fully" completed by the end of its fiscal year.