Microsoft to Cut 9,000 Jobs Amid AI Push Largest Layoffs

Microsoft to Cut 9,000 Jobs Amid AI Shift: Largest Layoffs Since 2023

Microsoft has confirmed a new wave of layoffs, cutting around 9,000 employees, or roughly 4% of its global workforce. This move marks the company’s largest staff reduction since it laid off 10,000 employees in 2023 and highlights a broader trend across the tech industry: investing heavily in artificial intelligence while reducing traditional roles.

???? A strategic reshaping in a dynamic market

A Microsoft spokesperson said the layoffs are part of “organizational changes necessary to best position the company and teams for success in a dynamic marketplace.” The company aims to reduce managerial layers and boost productivity using new technologies, particularly AI.

The cuts follow a similar round earlier this year when Microsoft laid off about 7,000 workers in May, representing 3% of its staff. As of July 2024, Microsoft had approximately 228,000 employees worldwide.

???? AI at the center of Microsoft’s future

CEO Satya Nadella revealed earlier this year that 20% to 30% of Microsoft’s code is now being generated by AI, a figure that illustrates how deeply AI is becoming integrated into the company’s workflow. Microsoft continues to invest billions into AI infrastructure, signaling that AI isn’t just a tool but a transformative force across its operations.

While AI promises efficiency, it also means fewer roles in some traditional areas, a trend echoed by other tech leaders. Amazon CEO Andy Jassy, for instance, recently noted that AI advancements would likely help reduce headcount at Amazon in the future.

???? Financial strength despite cuts

Despite these job cuts, Microsoft remains financially robust. In April, the company reported an 18% increase in quarterly profits, reaching $25.8 billion, driven by its cloud computing and AI services. Investors appear to view these layoffs as part of strategic cost management, with Microsoft’s stock remaining largely unchanged after the announcement.

???? Layoffs across the tech sector

Microsoft isn’t alone. Other tech giants, including Meta and Bumble, have also announced workforce reductions this year. As AI reshapes entire industries, many companies are adjusting staffing strategies to balance innovation with operational efficiency.

???? Final thought

Microsoft’s latest layoffs highlight a new reality in tech: even the strongest companies are transforming rapidly in the age of AI. While these cuts bring uncertainty for thousands of employees, they also underscore how deeply artificial intelligence is changing the way tech companies operate—and what skills the future workforce will need.

Stay tuned as Microsoft reports its fiscal fourth-quarter earnings later this month, which may offer more insight into how these changes are reshaping the company’s growth strategy.