Microsoft to cut up to 18000 jobs

Microsoft Corp. said on Thursday it would cut up to 18,000 jobs, or about 14 percent of its workforce, as it halves the size of its recent Nokia acquisition and trims down other operations.

Microsoft confirmed it will cut up to 18,000 jobs over the next year, part of the tech titan's efforts to streamline its business under new CEO Satya Nadella.

In a statement released Thursday, Microsoft says about 12,500 of the professional and factory positions will be cut as part of its $7 billion acquisition of Nokia's handset business, which the company closed in April.

"My promise to you is that we will go through this process in the most thoughtful and transparent way possible," said Nadella in a memo to employees.

Nadella, who replaced Steve Ballmer in February, says the "vast majority" of employees affected by layoffs will be notified within the next six months. They will also earn severance and job transition help in many locations. All cuts will be completed by next June.

The layoffs by Microsoft -- which employs 125,000 people -- are the company's largest since 2009, when they cut more than 5,000 jobs.

Daniel Ives, analyst with FBR Capital Markets, says the "larger than expected" layoffs hints at Nadella's plans to simplify Microsoft's infrastructure.

"Under the Ballmer era, there were many layers of management and a plethora of expensive initiatives being funded that has thus hurt the strategic and financial position the company is in, especially in light of digesting the Nokia acquisition," says Ives. "Nadella is using today as an opportunity to make sure that Microsoft is ready and well positioned to embark on its next chapter of growth around mobile and cloud."

Microsoft expects to incur pre-tax charges as high as $1.6 billion over the next four quarters, which will include $750 million to $800 million for severance and related benefit costs, and $350 million to $800 million of asset-related charges.

Chicago : Northern Trust cuts 200 jobs

Northern Trust Corp. announced today that it will cut 200 jobs as the bank struggles to hit its minimum profitability goals even though assets have grown substantially.

Chicago's largest locally headquartered bank said the layoffs, along with other cost actions, would trim $25 million from its annual expenses. Executives said the cuts were coming from a wide array of operations within the bank and would take place over the coming year.

A spokesman didn't have immediate comment on whether and to what extent those cutbacks would hit Northern Trust's Chicago workforce. Northern Trust employs 15,100 worldwide, so the layoffs amount to slightly more than 1 percent of its employees.

The bank reported second quarter earnings of $182 million, or 75 cents per share. The per-share figure was down from 78 cents a year before and even with the 75 cents posted in the first quarter.

Northern Trust, however, recorded $42 million in pre-tax charges and writeoffs, with $28.5 million earmarked for severance. Excluding those, the bank posted earnings of 87 cents per share, higher than the Wall Street consensus estimate of 84 cents. Its return on equity excluding the one-time costs was 10.6 percent, exceeding the bank's minimum goal of 10 percent.

However, Northern Trust's return on equity with the charges included was just 9.2 percent.

The bank, which focuses on serving wealthy families and institutional investors, continues to show growth in its key business lines. Assets under custody just exceeded $6 trillion, up 4 percent from $5.75 trillion in the first quarter. Assets under management were $924 billion, up 1 percent from $915 billion in the first quarter.

Chicago : Companies warn of nearly 1,700 Illinois job cuts

Thirteen companies may cut nearly 1,700 jobs in the coming months, according to a new state report.
The biggest cuts are from commercial printer Quad/Graphics Inc., which is laying off 537 workers in far northwest suburban Woodstock, according to the June report for the Illinois' Worker Adjustment and Retraining Notification Act, or WARN.

Sussex, Wis.-based Quad/Graphics is closing a plant there, according to reports earlier this year.
The second-largest cuts are at merchant wholesale Source Interlink Distribution LLC, with 244 layoffs already made in June in its McCook office. A lost contract is prompting the cuts, the company said in the WARN report.

Dallas-based AT&T Inc. announced 188 job cuts.

Jewelry company Lia Sophia will lay off 56 workers in Roselle and 28 in its Wood Dale office by August. The company declined to say why the jobs are being cut.

Additional layoffs announced in the report:
• Ridgeway, S.C.-based construction machinery and manufacturing company Bomag America's Inc. is laying off 92 workers in its Kewanee office.
• Montgomery-based Lyon LLC, which specializes in showcase and shelving manufacturing, is cutting 74 workers in Paris.
• Atlanta, Ga.-based Morrison Healthcare, a food service contractor, warned of 62 cuts because of a lost contract, according to the report.
• Fresenius Medical Care, a German company that produces medical supplies, is laying off 53 workers in its Westchester office. The reason was not provided.
• A liquidation at Chicago-based Sound Solutions Windows & Doors LLC is permanently laying off 52 workers.
• Chicago-based Lawrence Hall Youth Services, offering child and youth services, is cutting 51 workers due to a closing of an Elgin office. A representative said the Elgin office is closing because their services were no longer needed in the area.
• Eden Prairie, Minn.-based Supervalu Inc. will cut 44 workers in Urbana. The cause was not provided.
• Springfield, Mass.-based Hot Mama's Foods will cut 34 workers. A reason was not disclosed.
Representatives from these companies did not respond immediately today to calls requesting comment.
Also in the report: Chicago-based Magid Glove & Safety Manufacturing Co. is moving 156 workers from its current manufacturing facility to a new one opening in Romeoville. The company reports that it is not laying off any of those employees.

Chicago : Braintree parent to add 360 jobs

Credit-card software company Braintree Inc. plans a hiring spree at its large new headquarters in the Merchandise Mart.

California-based eBay Inc., which acquired Braintree in 2013, plans to add 360 jobs in the next three years, confirmed Gov. Pat Quinn's office, which is providing $12 million in state incentives.

Crain's last month reported Braintree's lease for 60,000 square feet at the Mart in River North. It will move there in the third quarter, from 27,000 square feet at 111 N. Canal St. in the West Loop.

Braintree, owned by eBay, is moving to the Merchandise Mart. 

San Jose, California-based eBay doesn't plan to waste time filling Braintree's significantly larger Chicago space. The PayPal parent has pledged to create 216 new full-time jobs by March 2016 and another 144 by March 2017.

If it meets those targets, eBay will receive $12 million in Economic Development for a Growing Economy (EDGE) tax credits paid over 10 years by the Illinois Department of Commerce and Economic Opportunity, Mr. Quinn's office confirmed.

$24 MILLION INVESTMENT
“EBay Inc. is built on innovation and we welcome its interest in providing quality jobs for Illinoisans,” Mr. Quinn said in a statement. “By coming here, it will benefit from our state's leadership in emerging technology and from access to a workforce with skills that are second to none.”

Under the EDGE agreement, eBay will invest $24 million toward expanding Braintree in Chicago.

It was acquired by eBay for $800 million late last year. Spokeswomen for Braintree and eBay and Braintree CEO Bill Ready did not respond to questions about what is driving the rapid growth or how many people Braintree currently employs in Chicago.

The number is 140, according to a DCEO spokesman.

"Everyone at Braintree is pumped to be moving to bigger digs in Chicago to support our growth, just six months after joining the PayPal family," Mr. Ready said in a statement. "We're looking forward to moving into our office space at the Merchandise Mart soon and continuing our involvement in the budding Chicago tech scene."