Fresh layoffs at Microsoft, people terminated across verticals for ‘future growth’

Microsoft has initiated another round of layoffs this week as part of its ongoing effort to streamline its workforce. While the exact number of employees affected remains undisclosed, it is clear that the cuts have impacted various teams and geographical locations. According to a report by Geekwire, several posts on LinkedIn from those who were laid off indicate that the terminated roles included those in product and program management.

A spokesperson for Microsoft explained that these “organisational and workforce adjustments” are a necessary and regular part of managing the business. Despite the layoffs, the company continues to prioritise and invest in strategic growth areas to ensure future success and to support its customers and partners.

These layoffs come shortly after the conclusion of Microsoft’s fiscal year 2024, which ended on June 30. It is not uncommon for the company to restructure parts of its business as it transitions into a new fiscal year. Just last month, Microsoft cut approximately 1,000 jobs across various departments, including its Azure cloud unit and HoloLens mixed-reality team.

Earlier this year, in January, Microsoft laid off nearly 2,000 employees from its gaming division. This significant reduction occurred three months after the company completed its $69 billion acquisition of Activision Blizzard, the largest acquisition in Microsoft’s history.

The ongoing layoffs are part of Microsoft’s broader strategy to maintain profit margins amid increasing capital expenditures. These expenditures are aimed at building the cloud infrastructure necessary for training and deploying models that power AI applications. During the COVID-19 pandemic, Microsoft’s headcount surged, but it has since stabilized. By the end of 2023, the company employed approximately 227,000 people globally, down from 232,000 the previous year.

The tech industry as a whole has experienced significant workforce reductions this year. According to Layoffs.fyi, more than 100,000 tech workers have been laid off so far in 2023. Last year, the industry saw over 260,000 employees laid off.

Microsoft’s layoffs are reflective of a broader trend within the tech sector, where companies are striving to balance growth and profitability in a rapidly changing economic environment. As the company continues to invest in strategic areas such as AI and cloud computing, it is also making tough decisions to streamline operations and optimize its workforce.

The recent layoffs are part of Microsoft’s strategy to adapt to changing business needs and invest in future growth areas. This approach aims to ensure the company’s long-term success while navigating the challenges and opportunities of the evolving tech landscape.