Microsoft is preparing to launch new Windows phones, including one made for taking selfies, as part of its plan to shift the focus from gadgets and services to productivity, mobile, and cloud.

Two weeks ago, former Nokia CEO Stephen Elop, who now heads Microsoft's hardware department, wrote a memo revealing the plan to attract more Lumia buyers by slashing prices.

"In the near term, we plan to drive Windows Phone volume by targeting the more affordable smartphone segments, which are the fastest growing segments of the market, with Lumia," Elop wrote.

Now, sources of The Verge said Elop unveiled two handsets in an internal meeting held in Seattle this week: a "selfie" phone and a "Tesla" phone.

The selfie phone features a 5-megapixel front camera and a 4.7-inch display. Sources hinted about the development of the phone in April using the code name "Superman", which will reportedly debut this year after the Windows 8.1 update.

The second phone presented in the meeting, code named "Tesla," came equipped with a PureView camera. Sources said the design is similar to the Lumia 930, but thinner and smaller. Microsoft plans to market it as an affordable, high-end phone. Its alleged images leaked early this month featuring an aluminum frame with a polycarbonate back, similar to Lumia 925 and Lumia 930.

There is no definite launch date for the new devices, but if the previous rumor was true, it will come out at the same time that HTC unveils the Windows version of One M8, which is said to be happening this August.

Microsoft seemed serious on its strategic direction to shift to devices. According to Techcrunch, the software giant now builds 95 percent of all Windows phones and sells millions of phones each month. Sales rate is also increasing by 0.7 percent per month.