Microsoft to Cut 5k Jobs

Apparently even the deep pockets of Microsoft aren’t immune to the sagging economy. Early this morning, the company reported that its earnings for the financial quarter had dropped by more than $50 billion over the same quarter just a year ago. As a result, Microsoft stated that it would be cutting upwards of 5000 jobs across the board in its R&D, marketing, sales, finance, legal, human resources, and IT departments over the next 18 months, roughly five percent of its estimated 95,000 total workforce. The move will include an immediate cut of about 1,400 jobs today, and is expected to help cut its annualized operating expense by about $1.5 billion and reduce total expenditures by as much as $700 million.

“Economic activity and IT spend slowed beyond our expectations in the quarter,” Chief Financial Officer Chris Liddell said in a statement. “We are planning for economic uncertainty to continue through the remainder of the fiscal year, almost certainly leading to lower revenue and earnings for the second half relative to the previous year.”

Microsoft pointed to a weak PC market and the popularity of low-cost notebook computers for it falling below expectation. Shares of Microsoft dropped $1.54 per share in early trading, falling to $17.84 from $19.38 in early trading on Nasdaq.