Software giant Microsoft said Thursday it will cut 800 positions worldwide. The latest round is part of Microsoft’s previously announced move to eliminate 5,000 jobs or five percent of its workforce.
Microsoft has been eliminating jobs for nearly two years to reach a healthier operating position and save $1.5 billion a year. The Redmond, Wash.-based business needs to make the job cuts because of decreased sales, specifically in enterprise IT. Microsoft announced it would begin the major cuts in January after reporting a $465 million shortfall in OEM revenue, according to the company’s financial reports.
“Earlier this year, we announced that in order to reduce costs, increase efficiency, and prioritize our focus areas, we would eliminate approximately 5,000 positions by June 2010,” said Microsoft spokesperson Lou Gellos in an e-mail. “Today, we are eliminating around 800 positions spread across multiple businesses and locations and have completed our reduction plan sooner than we had anticipated 11 months ago.”
In May, Microsoft CEO Steve Ballmer said the company was close to achieving the 5,000 cuts. The most recent head count taken on Oct. 23 shows 91,005 employees worldwide, down 1,758 from the reported 92,763 it had just four months ago and the 95,000 it had in January.
While Microsoft is still hiring in specific areas of the company, it may have to reduce the number of employees again, the spokesperson told us.
“At the same time we continue to hire in priority areas, but also understand that continuing to manage our businesses closely, as we always do, can mean additional head-count adjustments,” Gellos said.
Analysts say the move makes sense. “I think the past year has been difficult for technology companies of any size,” said Charles King, principal analyst with Pund-IT. “Even for a company that has long been profitable and successful like Microsoft,…