Microsoft announces 18,000 job cuts in reorganisation

Microsoft said on Thursday it would slash 18,000 jobs from its global workforce over the next year, the majority from the integration of the Nokia unit acquired this year.

A worker walks past a Microsoft Corp. sign outside the Microsoft Visitor Center in Redmond, Washington. -AP

A Microsoft statement said the move is part of “a restructuring plan to simplify its operations and align the recently acquired Nokia Devices and Services business with the company’s overall strategy.”

The cuts represent about 14 per cent of Microsoft’s global payroll of some 127,000. The company will take a charge of between $1.1 billion and $1.6 billion for costs related to the layoffs.

Chief executive Satya Nadella said in an email to employees that the “difficult but necessary” cuts are part of a plan to bring a new strategic direction to the US tech giant.

“The first step to building the right organisation for our ambitions is to realign our workforce.

“It’s important to note that while we are eliminating roles in some areas, we are adding roles in certain other strategic areas.”

Microsoft completed its takeover of Nokia’s phone unit in April in a move that strengthened its position in mobile devices. The cost was around $7.5 billion.