Microsoft to cut up to 3000 jobs in major reorganization
Jul 08 2017
Microsoft has confirmed a round of layoffs said to impact about 10 percent of its total salesforce, or approximately 3,000 workers, with the majority outside of the US, according to several reports on Thursday.
Microsoft has 71,000 employees in the USA and 121,000 employees around the globe, suggesting that these cuts are relatively small compared to the size of its entire workforce. Most of the positions expected to be eliminated are outside of the United States and related to the sales reorganization. Instead, it will be sales people on the chopping block - with 75 percent of the jobs in peril located outside the US.
"Microsoft is implementing changes to better serve our customers and partners", Microsoft said in a statement.
A spokesperson for Microsoft tells CNBC that like all companies, they evaluate their business on a regular basis.
CNBC says the layoffs are part of a "major reorganization".
Microsoft has now broken its silence and confirmed that cuts accounting for less than 10 percent of its global salesforce are to go ahead. That's around 10% of the company's sales staff.
Chief executive Satya Nadella has been focusing on the firm's cloud unit, which has been a source of strength for Microsoft.
Some reports also claim that Microsoft workers were notified yesterday if their current job was affected or not. Microsoft doesn't give specific revenue figures for its cloud computing platform, Azure, but said in its most recent earnings report that Azure revenues grew 93%.
"At companies transitioning from the old world to the new world you will see layoffs accelerate; it's a slow and gradual and painful experience for them". Azure is Microsoft's equivalent to Amazon's wildly popular AWS cloud server product, and it's proved profitable already.
The company said revenues from "Intelligent Cloud" rose 11 percent from a year earlier to $6.8 billion and that its Office commercial products and cloud services revenue increased seven percent.