Microsoft Announces Major Layoffs Affecting 9,000 Employees Amid Strategic Restructuring
Microsoft is laying off around 9,000 employees, about 4% of its workforce, as part of a strategic restructuring while continuing to invest in AI and infrastructure.
Overview
- Microsoft is laying off approximately 9,000 employees, representing about 4% of its total workforce, in its largest layoff in over two years.
- The layoffs will impact various global teams, including the Xbox gaming division and sales, as part of organizational changes.
- Despite the job cuts, Microsoft reported strong financial results with $26 billion in net income for the March quarter and $70 billion in revenue.
- Microsoft is investing heavily in data centers and AI infrastructure, pledging $80 billion in capital spending for fiscal year 2025.
- CEO Phil Spencer announced the layoffs to position the Xbox business for strategic growth, following a trend of reducing management layers.
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Analysis
Center-leaning sources frame Microsoft's layoffs as a significant and troubling trend, emphasizing the impact on employees and the company's management structure. They express concern over the frequency and scale of job cuts, hinting at a cost-cutting motive tied to AI investments, reflecting a critical perspective on corporate decisions.
Microsoft has announced its third round of layoffs since 2023, affecting about 9,000 employees, or just under 4% of its global workforce.
The company announced on Wednesday that it will be laying off approximately 9,100 employees, which represents close to 4% of its workforce.
Microsoft is focused on building high-performing teams and increasing agility by reducing management layers, according to CFO Amy Hood.
The tech giant initiated layoffs affecting its Xbox video game business and other divisions on Wednesday.
830 workers tied to Microsoft's headquarters in Redmond, Washington are losing their jobs.
The company has confirmed that the recent layoffs amounted to approximately 4% of its workforce from a year ago.
Microsoft announced global layoffs impacting various teams, including sales, as part of organizational changes to thrive in a dynamic marketplace.
Xbox CEO Phil Spencer announced cuts to the gaming division to position the business for enduring success and focus on strategic growth areas.
Microsoft had 228,000 full-time employees as of its last reported annual headcount in June.
Microsoft recently laid off 300 workers from its Redmond headquarters, in addition to 2,000 job cuts in the Puget Sound region in May, primarily affecting software engineering and product management roles.
Microsoft has trimmed Xbox staff after years of expanding its gaming console business, culminating in the $75.4 billion acquisition of Activision Blizzard in 2023.
Microsoft's net income for the March quarter was nearly $26 billion on revenue exceeding $70 billion.
Approximately 9,000 workers will be impacted by the layoffs company-wide.
Microsoft is investing heavily in AI infrastructure, leading to cutbacks in other areas such as layoffs.
Microsoft is laying off about 9,000 workers, marking its largest mass layoff in over two years.
Articles (12)
Center (7)
"…The latest layoffs, however, seemed centered on slower-growing areas of the company’s business, said Wedbush Securities analyst Dan Ives."
Chicago Tribune·19h·"…The company has repeatedly characterized its recent layoffs as part of a push to trim management layers, but the May focus on software engineering jobs has fueled worries about how the company’s own AI code-writing products could reduce the number of people needed for programming jobs."
Fortune·20h·"…Microsoft said Wednesday that it will lay off about 9,000 employees."
NBC News·22h·"…Microsoft is laying off about 4% of its workforce, the company said Wednesday."
USA TODAY·1d·"…The cuts will affect 9,000 workers across the company, as it continues to make moves to trim its staff."
CBS News·1d·"…Microsoft is firing thousands of workers, its second mass layoff in months."
Associated Press·1d·"…Microsoft has said that these cuts are an attempt to cut down on its layers of management, following the lead of competitors like Amazon and Meta."
TechCrunch·1d·FAQ
Microsoft is conducting layoffs as part of a strategic restructuring to increase agility, reduce management layers, and better position the company and teams for success in a dynamic marketplace, even while reporting strong financial results.
The layoffs will impact various global teams, including the Xbox gaming division and sales teams, as part of organizational changes.
Microsoft plans to invest heavily in data centers and artificial intelligence infrastructure, pledging $80 billion in capital spending for the fiscal year 2025 to support strategic growth.
The layoffs of approximately 9,000 employees represent about 4% of Microsoft's total workforce, marking the company's largest layoff in over two years.
History
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