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Nokia To Lay Off 300 Employees

Nokia, Microsoft's all-in Windows Phone partner, today announced it will lay off 300 employees.

The move is part of a streamlining of Nokia's global IT organization to fit the company's smaller global scale and will also involve transferring IT activities and about 820 employees to HCL Technologies and TATA Consultancy Services. Most of the affected employees are in Nokia's home country of Finland.

According to Nokia, the effective cut of about 1,120 staff is the last anticipated staff reduction in a massive restructuring announced in June 2012, when Nokia said about 10,000 jobs would be eliminated by the end of 2013.

The once-dominant phone maker is in the midst of a monumental turnaround effort. Nokia found itself losing share rapidly as the Apple iPhone and Google Android-based devices surged. In February 2011, CEO Stephen Elop responded with a controversial revitalization plan that involved de-emphasizing  Nokia's own phone software in favor of Windows Phone via a major partnership with Microsoft. Markets punished Nokia's stock for the strategy and for Nokia's slow progress in taking share from other smartphone makers and platforms with Windows Phones, even as sales of Nokia's proprietary-OS phones declined faster than the company had projected.

Last week, Nokia surprised the markets with better-than-expected sales of the Lumia, Nokia's brand of smartphones running Windows Phone. The company reported sales of 4.4 million Lumia smartphones in the fourth quarter of 2012, aligning with a major wave of marketing for Windows Phone 8 by Microsoft and major carriers. While the numbers still pale in comparison to sales volumes for leading smartphone brands, the growth was far more robust than anything Nokia has shown before with Windows Phones.

Nokia reports earnings for the fourth quarter and the full year on Jan. 24.

Posted by Scott Bekker on January 17, 2013 at 11:58 AM


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