Based in Keilaniemi, Espoo, it was established in 2014 following the acquisition of Nokia's Devices and Services division by Microsoft in a deal valued at €5.4 billion, which was completed in April 2014.

Under a 10-year licensing agreement, Microsoft Mobile held rights to sell feature phones running the S30/S30+ platform under the Nokia brand.

In May 2016, Microsoft abandoned its mobile business, selling the Nokia feature phone line and trademark rights to the Finnish startup HMD Global, and announcing that it planned to cut up to 1,350 positions in Finland and focus on offering its productivity services on competing mobile platforms.

[13] In August 2011 Chris Weber, head of Nokia's subsidiary in the U.S., stated that "The reality is if we are not successful with Windows Phone, it doesn't matter what we do [elsewhere].

[27][28] On 8 February 2012, Nokia announced 4,000 layoffs at smartphone manufacturing plants in Europe by the end of 2012, to move assembly closer to component suppliers in Asia.

On 14 June 2012, Nokia announced 10,000 layoffs globally by the end of 2013[30] and that it would shut production and research sites in Finland, Germany, and Canada, in line with continuing losses and the stock price falling to its lowest point since 1996.

[33] Nokia's CEO admitted that the company's inability to foresee rapid changes in the mobile phone industry was one of the major reasons for the problems.

[35] On 22 August 2012, it was reported that a group of Finnish Nokia investors were considering gathering signatures for the removal of Elop as CEO.

Steve Ballmer considered the purchase to be a "bold step into the future" for both companies, primarily as a result of its recent collaboration.

[47][48] In an interview published in Helsingin Sanomat, former Nokia executive Anssi Vanjoki commented that the Microsoft deal was "inevitable" due to the "failed strategy" of Stephen Elop.

[51] The acquisition of Nokia's mobile phone business by Microsoft was closed on 25 April 2014 for "slightly more" than the originally stated €5.44 billion.

[61][62][63][64] On 17 July 2014, it was reported that a major round of layoffs, totaling over 18,000 across the entire company, would occur at Microsoft over the following year.

It was also reported that Microsoft had ended future development of Nokia's Asha, Series 40, and X lines, in favor of focusing exclusively on Windows Phone.

The support site for legacy phones, accessories, as well as other Nokia-branded devices and services, Nokia Discussions, was renamed the Microsoft Mobile Community.

[86] In September 2014, Microsoft announced Windows 10 operating system, a common platform for smartphones, tablets, laptops and Xbox.

[102] In Q2 2015, feature phone sales declined year-over-year, with a total of 40 million being sold for a total revenue of $2.28 billion, and a gross margin of $330 million (14%), being significantly lower than previous years due to a global decline in the demand for feature phones in favour of smartphones.

New Microsoft CEO Satya Nadella stated that the company planned to have a "more effective and focused phone portfolio", and aimed to "create a vibrant Windows ecosystem including our first-party device family.

[127] In April 2016, it was revealed that 2.3 million Lumia devices were sold in the previous quarter, a major drop compared to 2015.

[128] The rapidly falling sales, coupled with Windows Phone market share dropping below 1%,[129] led to Microsoft announcing on 23 May the "streamlining" of the business.

In mid-September 2013, a media report revealed that Nokia tested the Android operating system on both its Lumia and Asha hardware.

[154] On 11 December 2013, a report showed that development of the Asha-like device, codenamed "Normandy", was continuing, despite the finalisation of Nokia's acquisition by Microsoft.

These devices, which were aimed towards emerging markets, run a modified version of Android known as Nokia X Software Platform, which was aligned towards Microsoft services and did not use Google Play Store.

In a company memo released in July 2014, it was announced that, as part of cutbacks, Microsoft would end the Asha, Series 40, and X range entirely, in favor of solely producing and encouraging the use of Windows Phone products.

[156] During the July 2014 job cuts and restructuring at Microsoft, these device lines were moved to "maintenance mode", and would be discontinued, along with Nokia X and Series 40,[157] in favour of solely producing Windows Phone products.

The Nokia 215, released in 2014, allowed users to browse the internet with Bing and MSN Weather and came pre-installed with Opera Mini.

In newer devices Microsoft has bundled the Swedish company Colourd's headsets as opposed to first-party hardware.

When Treasure Tags are attached to small valuables, such as keys or wallets, the Lumia device can show a map to help locate them.

Compared to the original, the Treasure Tag Mini comes in fewer colours, has shorter battery life, lacks NFC capabilities, and has no notification tones.

Elop was joined by Nokia executives Jo Harlow (smart devices), Juha Putkiranta (operations), Timo Toikkanen (feature phones), and Chris Weber (sales and marketing), who gained similar positions at Microsoft.

[182] On 17 June 2015, as part of a reorganisation, Microsoft announced that former Nokia executives Stephen Elop,[183] and Jo Harlow would be leaving the company.