Microsoft Joins Tech Layoff Wave, Slashes 6,000 Jobs in Latest Workforce Cut

Continuing the recent trend of widespread job cuts in the tech industry, Microsoft has announced the layoff of around 6,000 employees, which constitutes roughly 3% of its total workforce. The announcement was made on Tuesday.

According to Microsoft, the layoffs span all teams, levels, and geographies. This marks the company’s second-largest layoff since 2023, when about 10,000 employees were let go.

The decision comes as Microsoft pivots towards a greater focus on artificial intelligence to remain competitive.

Washington Among the Hardest Hit

Washington, home to Microsoft’s headquarters in Redmond, has seen one of the most significant impacts, with around 1,985 employees affected.

Most of the affected workers are in roles related to software engineering or product management. Microsoft stated that the cuts are intended to reduce the number of managers and streamline operations.

In addition to core engineering roles, the layoffs have also impacted Microsoft’s gaming division, Xbox, and its career-focused platform, LinkedIn.

“We continue to implement organisational changes necessary to best position the company for success in a dynamic marketplace,” a company spokesperson said.

Layoffs Follow Strong Financial Results

The layoffs come shortly after Microsoft posted impressive financial results for the January to March quarter. The company reported $70.1 billion in revenue and $25.8 billion in net income, exceeding Wall Street expectations.

Microsoft’s Chief Financial Officer, Amy Hood, stated during an earnings call that the company is focused on “building high-performing teams and increasing our agility by reducing layers with fewer managers,” according to the Associated Press.

As of June last year, Microsoft had 228,000 full-time employees, with 55% of them based in the United States.

Daniel Zhao, lead economist at workplace review site Glassdoor, explained the broader context of the layoffs: “I think many people have this conception of layoffs as something that struggling companies have to do to save themselves, which is one reason for layoffs but it’s not the only reason. Big tech companies have trimmed their workforces as they rearrange their strategies and pull back from the more aggressive hiring that they did during the early post-pandemic years,” he told AP.

Director of AI Among Those Affected

Among those laid off was Gabriela de Queiroz, Director of Artificial Intelligence for Microsoft for Startups. She shared the news on social media, describing her exit as “bittersweet.”

According to her post, employees were told to stop work immediately after receiving the news, though she chose to stay a bit longer to attend meetings and say goodbye to her team.

“Bittersweet news to share: I was impacted by Microsoft’s latest round of layoffs. Am I sad? Absolutely. I’m heartbroken to see so many talented people I’ve had the honour of working with being let go. These are people who cared deeply, went above and beyond, and truly made a difference,” she wrote along with a smiling picture of herself.

Despite the abrupt dismissal, Queiroz maintained an optimistic tone. “I’m an optimist at heart. That hasn’t changed. My smile, my gratitude, my belief that each day is a gift—that’s all still here,” she added.

In closing her message, she reached out to fellow affected employees. “What’s next? I don’t know yet. It’s too soon to say. But I trust that something good will come out of this. To those also affected—you’re not alone. We are at least 6,000. And to those who’ve reached out, thank you. Your kindness means everything right now,” she concluded.

Online Reaction Sparks Debate

Her post sparked a wave of reactions from tech professionals and other users on social media. Many expressed disbelief at her dismissal, especially given her role in a department central to Microsoft’s AI push.

One user commented, “It’s ok to say there isn’t a bright side here bc this seems despicable to me: a company that has ballyhooed AI all over town and intruded into all our spaces with AI then fires…the director of AI. Makes no sense. None. Why use CoPilot when this happens? That’s how to see it.”

Another questioned, “I don’t understand how ‘the director of AI’ could be let go…? Like I get the big picture of: ‘AI could do that…’ or ‘fewer people with AI could do that…’ But of all roles ‘director of AI’ seems like an odd one to let go of.”

A third user joked, “Did the AI start directing itself?”

Microsoft’s Layoff Strategy

This round of layoffs follows the previous reduction in 2023, when the company eliminated 10,000 positions, less than 5% of its workforce.

Microsoft has stated that the layoffs are part of broader “organisational and workforce adjustments” designed to ensure effective business management.

The company insists the move is necessary to remain competitive and agile as it accelerates its AI integration. Microsoft aims to automate routine tasks and allow employees to focus on higher-value work.

CEO Satya Nadella previously mentioned that Microsoft was proceeding cautiously due to economic uncertainty and the risk of a potential recession.