- SMB Spotlight
Microsoft is to axe 18,000 jobs from across the company, including 12,500 from its newly merged Nokia division, in one of the firm's biggest staff overhauls for many years.
Microsoft chief executive Satya Nadella confirmed the cuts in an email to staff that was made public, explaining that he believes the shedding of such a large number of roles is vital to help Microsoft remain as efficient as possible.
"The first step to building the right organisation for our ambitions is to realign our workforce. With this in mind, we will begin to reduce the size of our overall workforce by up to 18,000 jobs in the next year," he said.
"Of that total, our work toward synergies and strategic alignment on Nokia Devices and Services is expected to account for about 12,500 jobs, comprising both professional and factory workers."
Nadella said the majority of those affected – 13,000 – will know within the next six months if they are to be let go, although he did not make clear if this would cover just Nokia, or Microsoft, or both.
"My promise to you is that we will go through this process in the most thoughtful and transparent way possible," added Nadella, confirming the standard attempts to soften the blow through severance pay and job transition guidance.
The layoffs will not be cheap, with Microsoft expecting to incur pre-tax charges of $1.1bn to $1.6bn over the next four quarters, including $750m to $800m for severance and related benefit costs.
The cuts had been expected after Nadella outlined his vision for the company in a memo last week, in which he said the company needs to be more efficient in order to innovative more successfully.