Microsoft to Lay Off Around Three Percent of Workforce in Organisation-Wide Cuts

The company had 2,28,000 workers as of June last year.

Advertisement
By Reuters | Updated: 14 May 2025 13:59 IST
Highlights
  • The cuts will be across all levels and geographies
  • Microsoft laid off 10,000 employees in 2023
  • Big Tech has been spending heavily on AI

Microsoft has earmarked $80 billion in capital spending this fiscal year

Photo Credit: Reuters

Microsoft said on Tuesday it was laying off less than three percent of its workforce, or around 6,000 employees, as the technology giant looks to rein in costs while funneling billions of dollars into its ambitious bet on artificial intelligence.

The cuts will be across all levels and geographies and are likely the largest since Microsoft laid off 10,000 employees in 2023. The company let a small number of staff go in January over performance-related issues, but the new cuts are not related to that, according to CNBC, which first reported the news.

Big Tech has been spending heavily on AI as they see the new technology as a major growth engine, while slashing costs elsewhere to safeguard profit margins. Google has also laid off hundreds of employees in the past year, as it looks to control costs and prioritise AI, media reports have said.

Advertisement

"We continue to implement organisational changes necessary to best position the company for success in a dynamic marketplace," a Microsoft spokesperson said on mail.

Advertisement

The company, which had 2,28,000 workers as of June last year, regularly uses layoffs to prioritise staffing in its main focus areas.

Tuesday's move comes weeks after Microsoft posted stronger-than-expected growth in its cloud-computing business Azure and blowout results in the latest quarter, calming investor worries in an uncertain economy.

Advertisement

But the cost of scaling its AI infrastructure has weighed on profitability, with Microsoft Cloud margins narrowing to 69 percent in the March quarter from 72 percent a year ago.

Microsoft has earmarked $80 billion (roughly Rs. 6,83,255 crore) in capital spending this fiscal year, with most of it aimed at expanding data centers to ease capacity bottlenecks for artificial intelligence services.

Advertisement

D.A. Davidson analyst Gil Luria said the layoffs showed Microsoft was "very closely" managing the margin pressure created by its heightened AI investments.

"We believe that every year Microsoft invests at the current levels, it would need to reduce headcount by at least 10,000 in order to make up for the higher depreciation levels due to their capital expenditures," he said.

© Thomson Reuters 2025

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

 

Get your daily dose of tech news, reviews, and insights, in under 80 characters on Gadgets 360 Turbo. Connect with fellow tech lovers on our Forum. Follow us on X, Facebook, WhatsApp, Threads and Google News for instant updates. Catch all the action on our YouTube channel.

Further reading: Microsoft, Layoffs, Google, AI
Advertisement

Related Stories

Popular Mobile Brands
  1. Xiaomi Pad 8 Launches Globally Alongside Xiaomi Tag: Price, Features
  1. Xiaomi Pad 8 Launched Globally With 11.2-inch LCD Screen, Snapdragon 8s Gen 4 Chip: Price, Specifications
  2. Xiaomi 17 Ultra Launched Globally With 200-Megapixel Persicope Camera Alongside Xiaomi 17: Price, Specifications
  3. NASA’s ESCAPADE Mission to Study Space Weather Between Earth and Mars
  4. Huawei Watch GT Runner 2 Launched Globally With Intelligent Marathon Mode, 3D Floating Antenna: Price, Features
  5. Honor Magic V6 With Nearly Creaseless Inner Display Teased By Product Manager Ahead of MWC
  6. Sony Said to Be 'Backing Away' From Launching Its Single-Player Games on PC
  7. Android 17 Beta 2 Released: Lets Users Create Bubble for Any App, Expands SMS OTP Protection
  8. Ultrahuman Ring Pro Launched With 15-Day Battery Life, Jade Biointelligence AI: Price, Features
  9. Monarch: Legacy of Monsters Season 2 Now Streaming on Apple TV+: Everything You Need to Know
  10. Vladimir OTT Release Date: When and Where to Watch Rachel Weisz Starrer Thriller Online?
Download Our Apps
Available in Hindi
© Copyright Red Pixels Ventures Limited 2026. All rights reserved.