Microsoft announced plans to lay off approximately 9,000 employees, impacting less than 4% of its global workforce across different departments, regions, and experience levels, as part of ongoing organizational adjustments.
The decision, made early in the 2026 fiscal year, reflects Microsoft’s commitment to positioning its teams for success in response to the evolving demands of the marketplace, with a company spokesperson emphasizing the necessity of these changes.
The big picture: This latest round of layoffs follows several previous phases of job reductions in 2025, including cuts based on performance in January, and larger-scale eliminations in May and June, bringing the total employee count to 228,000 as of June 2024, down from 238,000 the prior year.
- Notable in Microsoft’s history was the extensive downsizing in 2014 when the acquisition of Nokia led to 18,000 job cuts, showcasing the company’s ability to adapt to transformative events in the tech industry.
- Further insights reveal Microsoft’s strategic direction to simplify managerial structures across various divisions, aiming to enhance operational agility and streamline decision-making processes for increased efficiency, echoing market trends of reducing corporate layers.
Go deeper: Within the gaming division, CEO Phil Spencer communicated the rationale behind the reshaping efforts, emphasizing the strategic focus on areas with growth potential and the elimination of redundant tasks to foster long-term success and adaptability to market trends.
- Financially, Microsoft remains a strong performer, reporting impressive net income figures of nearly $26 billion on $70 billion in revenue for the March quarter, far surpassing projections and solidifying its position as a top player in the S&P 500 index with consistent profitability, driven by Azure cloud services and productivity software subscriptions.
- Despite the recent job cuts, Microsoft’s stock reached record levels at $497.45 per share on June 26, showcasing investor confidence prior to the announcement and suggesting that the market remains optimistic about the company’s future prospects and strategic initiatives.
