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APMicrosoft layoffs 2025 impact 9,000 employees as the company restructures globally despite strong profits. Discover why the tech giant is reducing staff again, what it means for its future, and how it fits into wider tech layoffs this year.
Microsoft layoffs 2025: Why the tech giant is cutting 9,000 jobs despite strong profits- Microsoft layoffs 2025 have once again raised eyebrows across the global tech community. On Wednesday, Microsoft announced it would lay off around 9,000 employees, affecting less than 4% of its global workforce. The decision comes just as the company steps into its fiscal year 2026, marking yet another wave of job cuts in an already turbulent year for the tech industry. While the company didn’t officially confirm the exact figure publicly, a source familiar with the matter told CNBC that the move spans across multiple departments, regions, and experience levels. This round follows earlier layoffs in January, May, and June, signaling deeper restructuring within the company.How big is this layoff compared to Microsoft’s workforce? Microsoft currently employs around 228,000 people globally. With 9,000 roles now being eliminated, this round alone impacts roughly 3.9% of the entire workforce. This follows earlier cuts in: January 2025: ~1% of staff May 2025: ~6,000 employees let go June 2025: ~305 employees affected When combined, Microsoft has cut over 15,000 roles in just the first half of 2025.Live Events Why is Microsoft laying off 9,000 workers when it’s making billions? This latest Microsoft layoff round in 2025 is part of a broader effort to streamline operations and reduce management layers. A spokesperson said via email, “We continue to implement organizational changes necessary to best position the company and teams for success in a dynamic marketplace.” Despite the job cuts, Microsoft is far from struggling. The company posted $26 billion in net income on $70 billion in revenue for the March quarter. These numbers far exceeded Wall Street estimates, making Microsoft one of the most profitable firms on the S&P 500. Still, internal shifts are happening. Like in May, Microsoft aims to flatten its hierarchy by trimming the layers of management between senior executives and day-to-day contributors.Which Microsoft teams are impacted the most? The Microsoft Gaming division, including Xbox, King, and ZeniMax, faces the brunt of the layoffs. King, the mobile game studio behind Candy Crush, is cutting around 200 roles, representing about 10% of its team. ZeniMax Europe and other regional offices are also seeing reductions. Internal sources confirm that multiple departments across product development, design, marketing, and support are being downsized or consolidated. In an internal memo, Xbox chief Phil Spencer wrote: “To position Gaming for enduring success, we will end or decrease work in certain areas of the business and remove layers of management to increase agility and effectiveness.”Sales, marketing, and middle management also targeted Beyond gaming, significant layoffs are hitting Microsoft’s Sales and Marketing teams, especially in: U.S. regional offices European marketing units Mid-level management and operations staff This aligns with Microsoft’s broader AI-first strategy, which includes: Streamlining organizational layers Automating functions through AI tools like Copilot Investing in AI sales enablement rather than traditional staffingWhere are the layoffs taking place? While the layoffs are global, certain patterns are emerging: U.S. teams, particularly in Washington and California, have been hit hard. European subsidiaries, including ZeniMax offices, are undergoing restructuring. India operations remain untouched, as Microsoft has committed a $3 billion investment in AI infrastructure and hiring in the region. This geographic targeting signals Microsoft’s pivot toward low-cost, AI-driven hubs in Asia.Microsoft says the layoffs are part of a strategic realignment to focus on artificial intelligence, efficiency, and long-term innovation. Key motivations include: $80 billion investment into expanding AI capabilities and data centers globally The need to flatten management hierarchies to become more agile Reallocation of resources toward AI product development, cloud infrastructure, and strategic growth markets An internal Microsoft source stated: “AI is driving how we think about teams. We want fewer layers, more execution.” How is Microsoft stock reacting to the layoffs? Following the announcement, Microsoft shares dipped by around 0.6% during early Wednesday trading. In comparison, the S&P 500 remained flat. The slight drop may reflect short-term investor reactions, but not necessarily long-term concerns. Even with the layoffs, Microsoft’s core business remains strong. Its cloud platform, Azure, and productivity tools like Office 365 and Teams are driving projected 14% year-over-year revenue growth in the June quarter, according to executives. Are other tech companies also laying off workers in 2025? Yes, Microsoft isn’t alone in making workforce cuts in 2025. Several major players in the tech and software industry are also streamlining: Autodesk Chegg CrowdStrike Additionally, ADP (Automatic Data Processing), a leading payroll services firm, revealed on Wednesday that the U.S. private sector lost 33,000 jobs in June, contradicting economists’ expectations of 100,000 new jobs, according to a Dow Jones survey. What’s the bigger picture for tech jobs in 2025? This year continues a broader trend of tech companies restructuring and optimizing operations. With AI growth, cloud expansion, and shifting remote work dynamics, companies like Microsoft are reevaluating how to stay lean and efficient while keeping innovation alive. While layoffs are painful and disruptive, especially on such a large scale, they reflect how businesses are adapting in a fast-changing digital economy. The Microsoft layoffs of 2025 show how even the most successful tech giants are making tough decisions amid strong financial performance. With over 9,000 jobs cut this time, it’s clear that organizational reshaping, not financial distress, is the driving force. As more tech companies follow similar paths, the landscape for software jobs is shifting—and professionals will need to adapt just as quickly. Stay tuned for updates as more details unfold around team-specific impacts and future hiring trends in the tech industry. FAQs: Q1: Why is Microsoft laying off employees in 2025? Microsoft is cutting jobs to restructure teams and reduce management layers. Q2: How many people has Microsoft laid off this year? Microsoft has laid off over 15,000 employees in 2025 so far.(You can now subscribe to our Economic Times WhatsApp channel)
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