Microsoft is selling its feature phone business to FIH Mobile, a subsidiary of Hon Hai/Foxconn Technology Group, and Finnish company HMD Global for $350m.
As part of the deal, Microsoft will transfer "substantially all" of its feature phone assets, including brands, software and services, care network and other assets, customer contracts, and critical supply agreements.
HMD Global will use the rights to use the Nokia brand for feature phones as part of its plans to launch a new range of Nokia-branded devices, which will also include Nokia-branded smartphones and tablets using the Android operating system, a remarkable turnaround considering that Nokia only sold its smartphone business to Microsoft, which wanted to boost Windows Phone, in 2014.
Microsoft made a huge bet on phones when it bought Nokia's smartphones business for $5.4bn just over two years ago.
It hasn't got better since: the company has revealed it only managed to sell 2.3 million Lumia smartphones in its third quarter.
While the smartphone business was the main focus of the Nokia acquisition, Microsoft also picked up Nokia's feature phone business.