Changes Galore in Microsoft Corporation (NASDAQ:MSFT) before the Q4 FY 14 earnings and looks like Satya Nadella wants change in attitude and approach to begin with. There might be more organizational changes and may be job cuts.
Bloomberg’s Betty Liu was reporting the memo by the CEO to Microsoft Corporation (NASDAQ:MSFT)’s employees which said that organizational changes are needed to turn the company around. She also said that people familiar with the plans say that job cuts are likely. Nadella wrote in his memo that employees should be bold, ambitious and to focus on the core that is unique to the company.
“According to people familiar with the plans, job cuts are likely.” Liu said.
In a recent interview with Bloomberg, Nadella said that Microsoft Corporation (NASDAQ:MSFT) has to make products that people love. He said he will speak more about this on July 22nd when the company reports earnings for Q4.
Microsoft Corporation (NASDAQ:MSFT) is looking to cut the jobs in the advertising department, sales and marketing. Though the company is not specifying the magnitude, the number might be in hundreds. This might be due to the initiative to control the cost on PC sales due to the slowdown in PC market. The reduction in marketing is also due to the high cost incurred in marketing of Windows 8. The company has spent over $6.2 billion in online campaign for windows 8 which didn’t prove very profitable and it was bound to lead the termination, especially with the new shift in culture.
The stock of the company has been on upside on Friday. Nadella wants a shift in culture and he wants people to be more creative and focus on their strengths. The key investors in Microsoft Corporation (NASDAQ:MSFT) are Valueact Capital with over 71.2 million shares and Eagle Capital Management with over 33 million shares as of march 31st 2014.