As part of an ambitious cost-reduction plan, software giant Microsoft announced today that it plans to cut up to 5,000 jobs over the next 18 months, with 1,400 employees being let go today.

The cuts will impact nearly all of Microsoft’s internal departments, including R&D, marketing, sales, finance, legal, HR, and IT. No word if cuts will also be made specifically on the Xbox side of business, though.

Microsoft expects save nearly 1.5 billion dollars in annual operating costs and reduce capital costs by 700 million. “While we are not immune to the effects of the economy, I am confident in the strength of our product portfolio and soundness of our approach,” noted company CEO Steve Ballmer.

Read more: Sony expects profits to surge, Nintendo posts record profits, Microsoft: Xbox 360 To Hit 25 Million Sold This Month, Ubisoft: Full Year Sales Up 36 Percent, Microsoft Wraps Up Planned Workforce Reduction, Cuts 800 Jobs