November 4th, 2009
Are the Microsoft layoffs over now?
When Microsoft announced in January that the company was cutting 5,000 jobs, it wasn’t clear how many waves it would take to realize that count. It looks like the cuts aren’t done yet, based on an initial report of November 4 layoffs by TechFlash and a follow-up by PaidContent.
(PaidContent is reporting Microsoft is going to cut 800, citing a company spokeswoman. It sounds like those being cut will be notified starting today. I’ve asked Microsoft to confirm this report and have yet to hear back. and have gotten a call back confirming the 800 figure.)
Microsoft officials haven’t been willing to provide a tally when asked for a count as to how many jobs had been cut by certain dates. The first round of layoffs was 1,400. At that time, Microsoft officials said to expect the “net headcount … to decline by 2,000 to 3,000 over the next 18 months.” (Some of those let go would be hired in other divisions, plus Microsoft planned to continue to hire in certain divisions, like Online Services, officials explained.)
In May, Microsoft made its second major wave of cuts but officials wouldn’t say how many individuals were let go. At that time, CEO Steve Ballmer said that Microsoft reserved the right to cut more than the originally announced 5,000, if need be.
(Since then, Microsoft has shed a couple of thousand employees by selling Razorfish, but is set to acquire up to 1,000 Yahoos if and when its Yahoo partnership is consumated.)
Microsoft has been making cuts across the board — in sales, marketing and the product groups. Products and teams from Flight Simulator, to Office Accounting, all have been hit.
So is Microsoft done? Wall Street analysts have been bullish about the company’s cost-cutting measures — maybe bullish enough to spur more.
In Microsoft’s 10-Q statement, filed at the end of October, company officials implied layoffs were over. From that statement:
“In January 2009, we announced and implemented a resource management program to reduce discretionary operating expenses, employee headcount, and capital expenditures. As part of this program, we announced the elimination of up to 5,000 positions in research and development, marketing, sales, finance, legal, human resources, and information technology by June 30, 2010. We have now completed this program and reduced our overall number of positions by approximately 5,000 and headcount by approximately 4,600.”
It’s unclear if the beancounters had taken into account the new wave of 800 as part of those figures or if this week’s cuts are going beyond the 4,600 who’ve been let go already.
Update: Microsoft spokesman Lou Gellos said that prior to today’s announcement, Microsoft already had cut 5,000 positions but only 4,600 people, since about 400 of those cut found new positions at the company. He said it’s not clear how many of the 800 cut today will be rehired. He said that Microsoft has now cut 5,800 positions total since January and indicated that — while no one is willing to say definitively that no more cuts are coming — Microsoft has exceeded its headcount reduction commitments.
Also no word yet on which teams/groups are part of this week’s cuts. If I hear more, I’ll update this post.
Update No. 2: Don Dodge of Microsoft’s Emerging Business team is one of today’s casualties.
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