Microsoft is slated to axe up to 18000 jobs this year. The bulk of it is from the Nokia division which Microsoft bought in April.
The cuts are 3 times more than the 6000 initially expected and it Microsoft will cut $600m per year in costs within 18 months of closing the acquisition.
Chief executive officer Satya Nadella, who took the helm in February, wants the firm to shift its focus away from software to online services, apps and devices.
“Making these decisions to change are difficult, but necessary,” Mr Nadella wrote in the announcement to staff.
Last week, he rebranded the firm as “the productivity and platform company for the mobile-first and cloud-first world.”
The cuts are aimed at helping Microsoft better compete with rivals including Google and Apple.
The last significant job cuts at the firm were in early 2009, when previous chief executive Steve Ballmer axed 5,800 staff.