Microsoft Layoff: Microsoft has decided to lay off 6,800 of its employees

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Microsoft has decided to layoff 3% of its employees, which will result in the loss of 6,800 jobs. The company is making big investments in AI and cloud infrastructure. The reason for the layoffs is to simplify the organizational structure.

Tech giant Microsoft has decided to lay off 3% of its employees worldwide. The company had about 2,28,000 employees till June 2024. This means that now about 6,800 employees will lose their jobs. Microsoft also fired 10,000 employees in 2023. The layoffs will affect many departments, levels and areas including LinkedIn. The company says that this layoff is part of the strategy to simplify the organizational structure of the company. A Microsoft spokesperson said, “We are constantly implementing the changes that are necessary to bring the company to a better position.”

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HoloLens and other hardware division teams were affected in the company’s layoffs in January 2023. The current layoffs are being done at a time when Microsoft is making big investments in artificial intelligence (AI) and cloud infrastructure. The company has set a target of spending $80 billion to strengthen Azure and AI-services this fiscal year. As soon as the news of layoffs came, Microsoft’s shares reached $449.26. This is the highest level so far this year. In July 2023, the company’s stock reached a record $467.56.

This time, performance is not the reason, but strategy is the reason

Microsoft has clarified that this time the layoffs are not performance based. That is, the people who are losing their jobs are not being fired because of their work. The aim of the company is to reduce the layers of management and make work easier.

The special thing is that Microsoft performed better than expected in its quarterly results in April 2024. Still, this layoff shows that Microsoft wants to use its resources more effectively. The series of layoffs in the tech sector continues. Meta also laid off 5% of its employees through performance-based exits this year, while Salesforce has eliminated more than 1,000 positions. Both companies are also moving towards an AI-focused strategy.

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