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Minimal Asia Pacific impact from 5,000 job cuts: Microsoft

Minimal Asia Pacific impact from 5,000 job cuts: Microsoft

Microsoft Corporation says only a very small number of its employees across the Asia Pacific, will be affected by this week's decision to cut 5,000 jobs from the IT giant's global staff.

Yesterday, the IT icon announced that it will cut up to 5,000 jobs in research and development, marketing, sales, finance, legal, human resources and IT over the next 18 months. The first 1,400 jobs will be cut immediately.

Microsoft projected that the job cuts will trim its annual operating expense run rate by US$1.5 billion and reduce its fiscal 2009 capital expenditures by $700 million.

The layoffs are being implemented due to IT spending that fell lower than the company's expectations for the quarter.

Microsoft's website says the software giant's operations and logistics centre is in Singapore and the worldwide Operations Group employs 10,166 people. The company employs 94,286 people world wide (at September 2008) with an average age of 37 years.

There are 56, 654 Microsoft employees in the US and 35,567 employees globally in their Sales and Marketing Support Group.

Single-digit job cuts

A Microsoft Singapore spokesperson said today: "I am unable to provide information on how many employees we have in the region, or the breakdown by function".

"However, I can confirm that the number of employees affected by the immediate job eliminations announced on 22 Jan is a single-digit number across Asia Pacific (excluding China, India and Japan)," the spokesperson said. "I would stress that this number is very small and we are working with the individual employees to assist them through this transition."

In the media announcement out of Microsoft headquarters at Redmond, Washington, CEO Steve Ballmer said: "While we are not immune to the effects of the economy, I am confident in the strength of our product portfolio and soundness of our approach. We will continue to manage expenses and invest in long-term opportunities to deliver value to customers and shareholders, and we will emerge an even stronger industry leader than we are today."

Microsoft CFO Chris Liddell said that economic activity and IT spend slowed beyond expectations in the quarter, and the company acted quickly to reduce its cost structure and mitigate its impact.

"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," Liddell said. "In this environment, we will focus on outperforming our competitors and addressing our cost structure."


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