Microsoft to have biggest layoffs in history

US tech giant Microsoft announced Thursday to have a workforce cut of 18,000, the largest in its history, over the next year in order to simplify business and align Norkia handset business.

Microsoft Chief Executive Satya Nadella said in an email to employees that about 12,500 jobs of the total reductions comes from the synergies and strategic alignment on Nokia Devices and Services, which Microsoft acquired in April for 7.2 billion dollars. Both professional and factory workers are effected.

The cut of first 13,000 positions is being started and the reduction plan is expected to be fully completed by June 30, 2015.

The layoffs, which account for over 14 percent of Microsoft's global workforce, will be the largest in the company's 39-year history. The previous round of massive layoffs is in 2009, when 5, 800 jobs were eliminated.

Nadella said the workforce reductions are mainly driven by the outcome of work simplification and Nokia handset business integration synergies and alignment. Microsoft is working to streamline its business process and management to accelerate the flow of information and decision making and make teams more productive and impactful.

"The first step to building the right organization for our ambitions is to realign our workforce," Nadella said.

The fact that the majority of layoffs are from where Microsoft mobile unit and Nokia handset business overlap is within the expectations of analysts. Microsoft's Nokia deal added 25,000 workers to its workforce and it has already promised to save costs of 600 million dollars per year following the deal.

Nadella, who took office in February, has described his vision to reinvent Microsoft as "the productivity and platform company for the mobile-first and cloud-first world". With Thursday's announcement, he attempts at simplifying Microsoft's infrastructure and making it ready to produce next round of growth on mobile and cloud computing, analysts said.