Microsoft cuts another 3,000 employees as part of its layoff of 18,000

Microsoft is laying off its third wave of 18,000 employees it announced it would cut over the course of a year.
Written by Mary Jo Foley, Senior Contributing Editor

On October 29, Microsoft officials notified another wave of employees that they are losing their jobs.


The cuts of approximately 3,000 employees today are believed to be largely support staff in human resources, finance, sales and marketing and IT. They are part of the 18,000 employees Microsoft officials said back in July that they'd be laying off over the course of a year.

In July, Microsoft announced the planned cuts of 18,000, with 12,500 of those cuts coming from employees Microsoft acquired as part of its acquisition of Nokia's handset and services business. The second round of those cuts, totaling about 2,100 employees, hit in September.

A final wave of cuts is expected in early 2015, sources said. Given Microsoft has already cut about 18,000 employees, that round should be fairly small.

Microsoft cut 13,000 employees total in the first wave back in July. That wave included some, but not all, of the former Nokia employees, my contacts say. It also included employees in the Operating Systems Group and just about every other group across the company. Microsoft also is planning to reduce its dependency on "contingent" (non-full-time) employees by 20 percent as part of its realignment.

A Microsoft spokesperson confirmed today's wave of cuts.

“We've taken another step that will complete almost all the 18,000 reductions announced in July. The reductions happening today are spread across many different business units, and many different countries," the spokesperson said.

As of mid-July 2014, Microsoft had more than 125,000 full-time employees on its payroll, a number that included the 25,000 employees it acquired as part of its Nokia acquisition.

As a result of the layoffs, Microsoft officials said the company would incur pre-tax charges of $1.1 billion to $1.6 billion for severance and related benefits costs and asset-related charges over the next four quarters.

Microsoft's last major round of layoffs occurred in 2009, when management eliminated 5,800 positions over the course of two-plus rounds. Then-CEO Steve Ballmer attributed the cuts in 2009 to a "response to the global economic downturn."

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