In the wake of Microsoft‘s announcement that it will lay off up to 18,000 employees over the next year, and that the Nokia X Android handset will eventually run Windows Phone, Microsoft’s hardware head Stephen Elop announced a number of operational changes in a public memo. The alterations include changes in manufacturing and design efforts, and, of course, job cuts.
Noting 12,500 planned layoffs, Elop intimates that of the coming job cuts at Microsoft, more than two-thirds will take place in its hardware division. Given that the Nokia deal brought around 25,000 new employees to Microsoft, that’s not too surprising.
Broadly, Elop states that the larger Microsoft strategy regarding hardware isn’t changing — Windows Phone remains a priority — but that its makeup of design and manufacturing assets will be tweaked. As expected, some design work in Finland will be wound down. And the company will move away from manufacturing in Komaron, Hungary.
The changes, unsurprisingly, impact Windows Phone more than other Microsoft hardware divisions. Elop’s comment on that specific matter should cause a few people who work on other hardware projects to breathe easier across Microsoft:
With a set of changes already implemented earlier this year in these teams, this means there will be limited change for the Surface, Xbox hardware, PPI/meetings or next generation teams.
Elop indicates that Windows Phone will continue to target both the high and low ends of the smartphone market. I think that can be read as saying that Microsoft hopes that its progress in some European markets will be transferable to its home-country.
Microsoft is up more than 3% in pre-market trading.