Microsoft announces 7 800 extra job cuts

Microsoft has announced it is cutting a further 7,800 jobs as it restructures its Nokia mobile phone unit bought last year for €5.44 billion (£4.5 billion). The cuts come after Microsoft axed 18,000 jobs from the unit last year.

Microsoft said in a statement that it would "restructure the company's phone hardware business to better focus and align resources". The company is facing strong competition in the mobile phone industry, dominated by devices powered by Google's Android system or Apple's iOS.

In a memo to staff, the company's chief executive Satya Nadella said: "I am committed to our first-party devices including phones. However, we need to focus our phone efforts in the near term while driving reinvention. We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem that includes our first-party device family."

Profits down

This announcement comes after the tech giant posted a 12 per cent drop in profits for the first quarter of the year.

The company stated that profits were down to $5 billion (£3.3 billion) in the first three months of 2015. It said in its latest trading update that the strengthening dollar had a "significant impact" on its results. 

The figures also included a $190 million charge which it used to reorganise its operations following the merger of Nokia's handset division.

It was boosted by its cloud computing division enjoying a boom in sales which doubled during the period. Microsoft is now confident that it will generate around $6.3 billion in annual sales to put pressure on its rivals.

This follows another fall in profits at the end of last year, with $4.5 billion posted in the three months to September, which is 13 per cent lower than the same time in 2013.

The company is putting a strong emphasis on mobile phones, and has recently unveiled its newest software Windows 10 that will be running on devices ranging from phones to tablets. The OS is expected to be available for purchase in the next weeks.