Microsoft lays off 6,000 people or 3% of its workforce

Microsoft is laying off 3% of employees across all levels, teams and geographies, a move that will impact about 6,000 people.

This despite better-than-expected results, with USD 25.8 billion in quarterly net income, and an upbeat forecast in April, according to CNBC.

“We continue to implement organizational changes necessary to best position the company for success in a dynamic marketplace,” Microsoft said in a statement. “To enhance our efficiency, we will minimize redundancy by streamlining our processes, procedures and roles.” 

Microsoft employed 228,000 full-time workers as of June 2024. Of these, about 55% were in the US.

The job cuts will be Microsoft’s biggest since early 2023, when the company cut 10,000 jobs, or 5% of its workforce, according to a report by The Guardian. 

The company’s chief financial officer, Amy Hood, said in an earnings call last month that Microsoft was focused on “building high-performing teams and increasing our agility by reducing layers with fewer managers.” 

Microsoft’s multiple business segments include software, gaming consoles, computers and cloud services. It is also focussing more on AI-powered offerings. The company is reportedly on track to invest about USD 80 billion this fiscal year to build out AI-enabled data centers to train AI models and deploy AI.

Google has also laid off hundreds of employees recently as it looks to cut down costs and prioritize AI.