This isn't entirely what you'd expect from a company that was prepared to plunk down billions of dollars to acquire Yahoo just a few months ago. The cuts may not stop there, either, with rumors that they may be looking at other cost reductions going forward. Microsoft isn't speaking openly about their plans, nor did they mention if a large job cut or smaller job cuts over a long period of time are in the works. The only for sure thing is that Microsoft is definitely hurting, with their stock value being cut nearly in half over the past year.
The company is often considered to have ample cash reserves, but the bottom line is that Microsoft is aware they aren't making money like they want anymore, so we can probably expect changes to come from them soon.