Microsoft Cuts 9,000 Jobs in Latest Round of Layoffs

• Microsoft Corp. (MSFT) is cutting nearly 4% of its 228,000-strong workforce, approximately 9,120 jobs, including 200 at its King division, to manage costs amid $80 billion in AI infrastructure investments for fiscal 2025.
• The layoffs, following 6,000 job cuts in May, aim to streamline operations by reducing managerial layers and optimizing products and roles, with the June quarter cloud margin expected to shrink due to rising AI costs.
• Other tech giants like Meta (META), Alphabet (GOOGL), and Amazon (AMZN) have also announced job reductions, reflecting industry-wide efforts to address economic uncertainties and cost pressures.

Microsoft Corp. (MSFT) is reducing its workforce by nearly 4%, affecting approximately 9,120 employees based on its June 2024 headcount of 228,000, as part of a broader strategy to control costs amid significant investments in artificial intelligence infrastructure. This follows a prior round of layoffs in May that impacted 6,000 workers, with Bloomberg News reporting last month that further cuts, particularly in sales, were planned. The company’s $80 billion capital spending commitment for fiscal year 2025, largely directed toward scaling AI infrastructure, has pressured its cloud business margins, which are expected to contract in the June quarter compared to the previous year.

The layoffs, first reported by The Seattle Times, include a 10% staff reduction at Microsoft’s Barcelona-based King division, known for the Candy Crush video game, impacting about 200 jobs, according to Bloomberg News. To streamline operations, Microsoft is cutting organizational layers, reducing the number of managers, and optimizing its products, procedures, and roles. This move aligns with broader trends in the technology sector, where economic uncertainties and rising costs have prompted widespread cost-cutting measures.

Other major tech firms are also trimming workforces to navigate similar challenges. Meta Platforms (META) announced earlier this year a 5% reduction in its lowest-performing employees, while Alphabet (GOOGL) has laid off hundreds of workers over the past year. Amazon.com (AMZN) has reduced staff across multiple segments, including its books division, devices and services unit, and communications teams. These actions reflect a broader push across Corporate America to streamline operations and bolster financial resilience amid inflationary pressures and economic uncertainty, with Microsoft’s latest cuts underscoring the delicate balance between investing in transformative technologies like AI and maintaining operational efficiency.

h/t Reuters

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