Microsoft is set to announce its biggest job cuts in five years as it looks to integrate Nokia Oyj's handset unit, according to people with knowledge of the company’s plans. Following Microsoft’s purchase of Nokia's devices division last September, the technology giant increased its staff numbers to 127,000 – more than rival firms Google and Apple.
Microsoft’s European headquarters in Reading is believed to be earmarked for possible redundancies. It is understood that the job cuts will be announced later this week and will affect staff working in overlapping Nokia-Microsoft departments, as well as in marketing and engineering; marketing for businesses and software testers may also be impacted in the restructuring. It is understood that some of the jobs cut will be within Xbox’s global marketing team.
Microsoft last announced major job cuts in 2009 when around 6,000 employees were laid off. It is possible the new restructuring plan may be the biggest in the history of the company. When the software firm agreed to acquire Nokia’s mobile phone business in September, it set out targets of $600m in annual cost savings for the 18 months following the deal.
Last week, Microsoft’s chief executive Satya Nadella circulated a memo to staff of plans to ‘flatten the organisation’ and develop leaner business processes. He urged employees to focus on the internet of things, mobility and the cloud to compete better with its rivals. Nadella said he would address detailed organisational issues when Microsoft reports quarterly results on 22 July.
When Mobile contacted Microsoft for comment on the matter, a spokesperson for the company said: 'Microsoft does not comment on rumour or speculation and is not commenting on restructuring plans.'