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Microsoft Said To Be Resuming Job Cuts on Sept. 18

Microsoft on Thursday is planning to execute the second phase of its biggest employee layoff in the company's history, according to a press report.

This second round of job cuts is expected to take place on Thursday, Sept. 18, according to a report posted today by veteran Microsoft reporter Mary Jo Foley, citing unnamed sources "close to the company." She indicated it wasn't clear how many employees would be laid off this time, but the cuts were expected to span all groups across the company. This second wave of job cuts is part of an 18,000 total employee layoff that was announced back in July.

The 18,000 job cuts, announced under the supervision of newly appointed CEO Satya Nadella, was larger than a record cut of 5,000 jobs that then-CEO Steve Ballmer had announced back in 2009. Ballmer cited the overall down economy as the reason for those cuts, but Nadella had suggested in a letter to employees that the July cuts were part of an overall realignment effort at Microsoft.

When Nadella announced the layoffs in July, he had indicated that 13,000 of the cuts would come over the next six months. Most of those cuts, or about 12,500 employees, were expected to come from Microsoft's newly acquired Nokia personnel, it was said. Microsoft had acquired about 25,000 Nokia employees after buying the smartphone maker in April for about $7.2 billion.

Microsoft's fact page currently lists a total of 128,076 Microsoft employees worldwide, but that statistic is dated from June 30, 2014. It seems Microsoft may be aiming to trim its size down to around 110,000 employees by the end of this current wave of job cuts.

The job cuts appear to be a signal to investors, rather than cost cutting due to company finances. Microsoft had a net $22 billion income in its fiscal-year 2014, according to its annual10-Q report. Microsoft may be aiming to please investors, who tend to favor job cuts for profitable companies, regardless of the reasons for those cuts.

Another investor-pleasing move is Microsoft's announcement today that its board of directors has issued a quarterly dividend of $0.31 per share, which will be payable on Dec. 11, 2014.

Microsoft also announced some board-member changes today. Newly appointed to Microsoft's board are Teri List-Stoll, executive vice president and chief financial officer of Kraft Foods Group and Charles W. Scharf, CEO of Visa. Both List-Stoll and Scharf will join the board on Oct. 1, bumping up the board to 12 members. List-Stoll will be part of the audit committee, while Scharf joins the "governance and nominating committee," according to Microsoft's announcement.

There was also a couple of board member retirements announced today. Dave Marquardt, General Partner at August Capital, and Dina Dublon, former chief financial officer at JPMorgan Chase, will end their stints on Microsoft's board after Microsoft's annual shareholder meeting in December. Marquardt has served on Microsoft's board since 1981. Dublon has served on the board since 2005.

Microsoft's stock recently has hit a record high. It traded at $46.76 today, down slightly by $0.07 per share in after-hours trading, according to Yahoo Finance.

About the Author

Kurt Mackie is senior news producer for the 1105 Enterprise Computing Group.

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