Microsoft to axe 18,000 jobs
July 17, 2014
Microsoft said in a statement Thursday it would slash 18,000 jobs from its global workforce in a restructuring plan aiming "to simplify operations and align the recently acquired Nokia business with the company's overall strategy."
In an email to Microsoft workers, Chief Executive Satya Nadella said that the "difficult but necessary" cuts were part of a plan to bring a new strategic direction to the company.
"It's important to note that while we are eliminating roles in some areas, we are adding roles in certain other strategic areas," he said.
Nadella added the first 13,000 layoffs would begin immediately, with the vast majority of employees facing job cuts to be notified over the next six months.
The layoffs amount to some 14 percent of Microsoft's 127,000-strong global workforce. The company said it would absorb a loss of between $1.1 billion (812 million euros) and $1.6 billion for cost related to the cuts.
Cost-cutting after a massive takeover
The downsizing is the result of a takeover of the Finnish mobile phone maker Nokia in April. That deal cost Microsoft around $7.5 billion.
The cuts are the deepest since former Microsoft CEO Steve Ballmer slashed 5,800 jobs in the midst of the 2009 financial crisis.
CEO Nadella said the restructuring would simplify the way Microsoft was driving "greater accountability, become more agile and move faster."
It would also mean fewer layers of management, both from the top down and sideways, he added.
In recent months, Microsoft has shifted its focus from traditional PC software to cloud computing and other cloud-based products. With the purchase of Nokia it also sought to compete with rivals Google and Apple in the field of mobile computing.
To highlight the change, Nadella rebranded Microsoft last week calling it "the productivity and platform company for the mobile-first and cloud-first world."
uhe/cjc (AP, AFP, Reuters, dpa)