July 17, 2014, 16:22 / Business

Microsoft will cut 14% of employees

The largest reduction in the company's history will occur mainly due to Nokia employees Sergey Smirnov

Andrew Harrer / Bloomberg

Software giant Microsoft announced the largest job cuts in the last five years in the context of the integration of Nokia's mobile division, The Wall Street Journal reported. During the year, 18,000 jobs, or 14% of Microsoft employees, will be cut. This is the most significant reduction in the company's history - the record so far was the dismissal of 5,800 employees in 2009.

The layoffs will primarily affect Nokia employees - approximately 12,500 people - and Microsoft's intersecting areas. As of June 5, 2014, the company employed 127,704 people, including 30,000 employees of the Nokia division. "We are beginning to cut the first 13,000 jobs. Most of the layoffs will receive notice within six months," the corporation's new CEO, Satya Nadella, said in a letter. The reductions are significant, but expected, notes The Verge resource: when absorbing the Nokia business, Microsoft promised to reduce costs by $600 million per year within 18 months after the deal.

Nadella's message notes that certain products from the Nokia X line will be transferred to the Lumia line and will run on Windows. This means that Microsoft will eventually stop producing smartphones running Android OS.

The reductions will also affect Russia. “In accordance with the new strategy, Microsoft today announced organizational changes and personnel reductions,” says Pavel Betsis, president of Microsoft in Russia, in a statement. “These changes apply to all countries where Microsoft operates, including Russia. And although cuts are always This is a painful thing, but in Russia they will affect a limited number of employees, constituting a small proportion of their total number."

Bloomberg reported this week, citing its sources, that the cuts will also affect employees of the marketing and engineering departments, in particular the departments responsible for global sales of Xbox video consoles. The cuts will also affect software testers, Bloomberg sources say.

In a previous letter to employees of the corporation, Nadella made it clear that it would “shrink” and employees should either look for new ways of development or leave it. Microsoft employees have been preparing for layoffs for several weeks, they have developed strategies and presentations of structural divisions for Nadella, Microsoft employees and sources close to the company told the WSJ.

Microsoft closed its deal to buy Nokia for $7.5 billion on April 25. The American corporation, having become the owner of part of Nokia's business, not only promised to support its devices, but also received the right to use the Nokia brand for mobile phones for 10 years.