Microsoft announced on Thursday that it will be cutting up to 18,000 jobs over the course of a year. This will be the largest cut in the company’s 39-year history.
Most of the layoffs will in the Nokia workforce. Microsoft acquired the Finnish phone maker only a few months ago, but already it will be eliminating 12,500 Nokia jobs. That will be around half of the employees that recently joined Microsoft, the technology and software company said.
“The first step to building the right organization for our ambitions is to realign our work force,” said Microsoft CEO Satya Nadella.
The cuts will cost Microsoft around $1.1 billion to $1.6 billion to cover severance costs for the next year. In the long run, of course, Microsoft hopes to save money due to the layoffs.
In other Nokia – Microsoft related news, Microsoft has announced that Nokia phones will no longer run on Android operating systems. Instead, lower-end phones will be running on Microsoft’s Windows Phone software.
“It is particularly important to recognize that the role of phones within Microsoft is different than it was within Nokia,” Stephen Elop, former Nokia chief executive who now runs the devices group at Microsoft, said on Thursday. “Whereas the hardware business of phones within Nokia was an end unto itself, within Microsoft all our devices are intended to embody the finest of Microsoft’s digital work and digital life experiences, while accruing value to Microsoft’s overall strategy.”
Although the technology and software company has around 127,000 employees, including those that came over in the Nokia merger, the 18,000 layoffs will certainly make a dent in that number. Previously, the highest amount of people ever laid off at once was in 2009, when 5,800 people lost their jobs. That was around 5 percent of the workforce at that time.
Microsoft’s last round of layoffs happened in 2012, but the number of people who lost jobs was tiny compared to this year’s cuts.