Microsoft to Fire 5000, Warns of Rough Times Ahead

As you no doubt have heard by now, Microsoft reported that they weren't very happy with their quarterly earnings report.  Sure, they managed to haul in $16.6 Billon in revenue and that number is still technically a 2% increase year-over-year, but it's not the kind of growth that they feel will be necessary to keep things looking great durng the economic downturn. Still, they missed estimates and nobody likes that.

To deal, they're laying off 1400 folks immediately and another 3600 over the next year and a half. Steve Ballmer wrote a letter for the company about the unprecendented move.

Now comes there part where we get crass: rumor has it that the bulk of the initial layoffs are coming from the Entertainment & Devices division, which is where Windows Mobile lives.  Now we know that more people doesn't always equal faster progress or better product and we don't know exactly which parts of the E&D division are taking the hit, but either way we find this news disappointing.  Although this division certainly isn't the core of Microsoft's business, it is a place where a lot of great innovation has happened recently (Xbox & Zune) and where we expect a lot of cool innovation ought to happen in the very near future (Windows Mobile and "Project Pink").  So the crass part of us says "Hey, don't let that stuff we're excited for get derailed by these layoffs, Microsoft!" and the business part of us says "Do you really want to direct cuts at one of your most successful divisions?"

The human part of us, though, hopes these folks will be able to find work and quickly.