HTC claims that the company's workforce will be more effective after the reorganization and optimization, which is expected to be completed by September this year.
HTC said it will lay off 1,500 employees from its Taiwanese division. Losses of Tw$9.8 billion in the last three months of 2017 represented its worst ever quarterly results.
The job cuts are part of a "realignment of resources" across the organisation, the company said in a statement.
HTC held just 0.3% of the smartphone market in the first quarter of this year, down from as much as 10% in 2011, according to data Gartner provided to CNNMoney.
The company said the layoffs will further its plans to bring its smartphone and VR businesses under common leadership in each region.
Under the deal, half of HTC's smartphone research and development team - about 2,000 people - would go to Google. HTC was once the name behind one in ten smartphones in the market, however, due to vast competition from other smartphone makers like Apple, Samsung and Chinese smartphone giants, the company has seen a massive decline in market share and sales.