FACTBOX: Microsoft outlines cost measures

SAN FRANCISCO (Reuters) - Microsoft Corp stunned Wall Street on Thursday with disappointing results and a profit warning. It will make cuts to reduce its annual rate of operating expenses by $1.5 billion.

Microsoft will:

- Slash fiscal 2009 capital expenditures by $700 billion;

- Eliminate up to 5,000 jobs in research and development, marketing, sales, finance, legal, human resources and information technology over the next 18 months;

- Of that total, 1,400 jobs will be cut from Thursday.

- Allow a net decline of 2,000-3,000 jobs in certain new positions over 18 months;

- Eliminate merit pay increases for fiscal 2010, set to start in September;

- Cut travel by 20 percent and reduce spending on vendors and contingent staff;

- Scale back Puget Sound campus expansion plans;

- Reduce marketing budgets;

- Make significant reductions in spending on vendors and contingent staff;

- "Continue to change" its workforce in support, consulting, operations, billing, manufacturing and data center operations, in direct response to customer needs;

- Add "thousands" of jobs in strategic areas such as search.

(Reporting by David Lawsky; Editing by Andre Grenon)