Microsoft has announced it will cut up to 18,000 jobs marking the deepest cuts in the company’s 39-year history.
The bulk of the cuts, around 12,500, will be in its phone unit Nokia, which Microsoft bought in April, the tech giant said.
Microsoft pledged to cut $600 million per year in costs within 18 months of closing the acquisition.
The cuts are much more severe than the 6,000 initially expected.
Microsoft employs 127,000 globally.
Chief executive officer Satya Nadella, who took the helm in February, wants the company to shift its focus away from software to online services, apps and devices.
“Making these decisions to change are difficult, but necessary,” Satya Nadella wrote in the announcement to staff.
Microsoft said it also planned to have fewer layers of management “to accelerate the flow of information and decision making.”
The company said staff affected by the job cuts would be notified over the next six months, and they would be “fully completed” by the end of June next year.
In total it said the cuts, including severance pay, would cost it between $1.1 billion to $1.6 billion over the next year.
Last week, Satya Nadella rebranded the company as “the productivity and platform company for the mobile-first and cloud-first world”.
The cuts are aimed at helping Microsoft better compete with rivals including Google and Apple.
The last significant job cuts at Microsoft were in early 2009, when previous chief executive Steve Ballmer axed 5,800 staff.
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