Early this morning Microsoft announced that it will reduce its headcount in the wake of its acquisition of Nokia‘s hardware assets. The company was, at one point, up more than 3% in per-market trading following the news. The company opened above $45 — a fresh 14 year high — before retreating, and then regaining some ground.
Investors, it seems, are content with the scale of the layoffs in contrast to the number of Nokia employees that Microsoft purchased — around 25,000 — and are not too bothered with an estimated $1.1 to $1.6 billion in pre-tax charges that the company will consume due to the staffing changes.
The layoffs also extend into Microsoft’s large “shadow workforce,” according to GeekWire.
The moves were expected. It was a guessing game as to how many people would go, but it was widely, and correctly estimated that the reduction in employment would be the largest single-event of its sort in Microsoft’s history.
The current 2% gain in Microsoft’s share price might appear modest, given the scale of the changes. However for a company worth around $370 billion to beat its sector by more than a net 2.5% on a down day after announcing a broad swath of news is notable. It’s even more so following a strong day that lifted its value nearly 4%.
Microsoft has risen more than 23% in value since its new CEO, Satya Nadella, took over that role at current market prices.