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Microsoft To Cut 5,000 Jobs

1/22/2009 10:20:00 AM Eastern

Redmond, Wash. — Microsoft will cut up to 5,000 positions over the next 18 months to help manage costs due to the harsh economic climate.

About 1,400 jobs will be eliminated today.

The news came during a surprise earnings announcement during which the company reported revenue of $16.6 billion for its second quarter, ended Dec. 31, up 2 percent from last year. Net income was $4.2 billion, down from the $4.7 billion posted during the same period last year.

The cuts will come from the company’s R&D, marketing, finance, legal, human resources and IT staffs.

“Economic activity and IT spend slowed beyond our expectations in the quarter,” said Chris Liddell, Microsoft’s chief financial officer. “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. In this environment, we will focus on outperforming our competitors and addressing our cost structure.”

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