Microsoft starts 2025 with a tough decision: Performance-based job cuts.
Here’s what’s happening:
Less than 1% of roles impacted.
Microsoft, which employs over 228,000 people, confirmed these cuts. A spokesperson said:
“When people are not performing, we take the appropriate action.”
Focus on growth areas.
Despite these cuts, Microsoft is emphasizing its growth in AI infrastructure and cloud services. Finance Chief Amy Hood shared in October that Azure revenue growth will accelerate in the first half of 2025.
Context matters.
Compared to its 10,000 layoffs in early 2023 and 1,900 gaming unit reductions after the Activision Blizzard acquisition, this round is much smaller.
Microsoft is balancing its workforce to match performance and strategic priorities—while navigating evolving dynamics with OpenAI and its AI-driven tools like Microsoft 365 Copilot.
This decision reflects a broader trend: Companies are realigning resources to stay competitive while navigating economic challenges.
What are your thoughts?