It's been about two months since Microsoft closed its $7.2 billion purchase of Nokia, and Monday marks the end of Microsoft's fiscal year. So far, there's been no word of whether the deal will lead to layoffs.
In a deal this large, involving nearly 25,000 new employees added to the payroll, that's unusual.
Apparently speculation has been growing in Redmond among Microsoft employees over when, and if, Microsoft could announce layoffs, sources told GigaOM's Barb Darrow. One source, described merely as a Microsoft insider, made a good point: “Look, [Microsoft CEO Steve] Ballmer buys Nokia and adds 25,000 people and a business that makes no money, so do the math.”
To be sure, Microsoft didn't buy Nokia just to gut it. But at the time that former CEO Steve Ballmer announced the deal, he did indicate that a number of departments would be "integrated" and that almost always involves layoffs of some type:
In his email to employees in September, 2013, he said:
"Finance, Legal, HR, Communications, DX / Evangelism, Customer Care and Business Development will integrate functionally at Microsoft. Sourcing, customer logistics and supply chain will be part of Stephen’s Devices organization. ICM / IT will also integrate functionally for traditional IT roles."
The company also said that the marketig/services team would be consolidated – that usually indicates layoffs – but said that Nokia's sales would remain "intact." Plus, Nokia executives were being assigned key roles inside Microsoft and that's a good sign for Nokia employees that they wouldn't be the only ones targeted if and when cuts do get announced.
So speculation has been running wild, with one source telling Darrow that some people even fear that Microsoft will trim as much as 10% of its workforce between Nokia and the reorganization that Ballmer instituted right before he retired.
Microsoft says it has over 127,000 employees as of June, up from 99,000 in 2013, with the growth obviously mostly due to Nokia.
There's no telling when Microsoft will announce if it does happen. Of course, it's possible the company hasn't announced impending layoffs because there aren't any coming. Microsoft doesn't have a big history of shedding employees. Its first and only really big layoff was a cut of 5,000 announced in January 2009.
Revenue has increased every year since then ($20 billion last quarter) and profits have been healthy, (nearly $7 billion that quarter). Microsoft could be planning on tightening its staff a little bit rather than having a massive purge.
But all the same, employees would like to hear a grand plan to put their minds at ease.
Microsoft declined comment.
