Major Layoffs Expected, Primarily in Sales
Microsoft is preparing to lay off thousands of employees, particularly within its sales division, according to a Bloomberg report citing sources familiar with the matter. The move is part of the company’s broader restructuring strategy as it shifts focus toward artificial intelligence (AI) and high-tech infrastructure.
Follows Previous Job Cuts and Rising AI Investments
This new wave of layoffs comes shortly after a May round that affected around 6,000 employees. Microsoft, which had 228,000 employees as of June 2024, is now undergoing significant organizational changes to align with its increasing investments in AI technologies.
$80 Billion Capital Expenditure Targeted at AI Infrastructure
To support its AI ambitions, Microsoft has allocated $80 billion in capital expenditure for this fiscal year. A large portion of that budget is set to go toward expanding its data center footprint—an essential move to support growing demand for AI services and alleviate capacity bottlenecks.
Broader Tech Industry Trend Toward Automation
The shift is part of a broader trend in the tech industry. Amazon CEO Andy Jassy recently stated that generative AI and AI agents would lead to a smaller corporate workforce over time. Microsoft is similarly streamlining operations to stay competitive in the rapidly evolving AI race.
Timing and Scope Still Evolving
While the layoffs are expected to be formally announced early next month—after Microsoft’s fiscal year ends—the final scope and timing could still change, Bloomberg noted. Microsoft has not yet issued an official statement on the matter and declined to comment when asked.
Industry Implications
This strategic workforce shift highlights how AI is reshaping the tech labor market. As companies like Microsoft pour resources into automation and intelligence-driven technologies, traditional roles in sales and support functions may continue to face downsizing, reflecting a wider industry transformation.
