Microsoft has sold its mobile and video advertising businesses to AOL in the US, UK and seven other key markets as it looks to focus on search advertising.
Microsoft said the move will "deliver more scale of premium inventory and target audiences across display, video and mobile".
As it slims down its loss-making online operations, Microsoft will also sell some of its map-generating technology to Uber.
Microsoft said in a statement it would continue to focus on its Bing search engine:
Today's news is evidence of Microsoft's increased focus on our strengths: in this case search and search advertising and building great content and consumer services.
Last year Microsoft's search advertising grew 39 per cent, whereas display advertising shrunk 25 per cent.
Although financial details of the deal have not been disclosed, AOL will be making job offers to up to 1,200 Microsoft employees in its display advertising business.
Around 100 Microsoft engineers in its data collection team at Bing will move to Uber after the taxi-app acquired parts of its map-generating technology.