Athira Sethu
Kochi, 3 July 2025
Microsoft, the world’s largest tech firm, is cutting about 9,000 workers. This is its second major layoff this year and the largest in more than two years. The job cuts are occurring across various regions of the company, including the Xbox games business, salesforces, and others.
Among the total, 830 workers from the company’s headquarters in Redmond, Washington, have been informed already. According to Microsoft, these lay-offs are part of a comprehensive plan to remake the company to compete more effectively in an increasingly dynamic global marketplace.
As per the company, layoffs in these numbers do not occur in a single department but are occurring across the world. There were approximately 228,000 full-time employees in June 2024, so these layoffs correspond to about 4% of the total employee base.
Xbox head Phil Spencer stated that the moves will enable the gaming business to grow in the correct places. He also noted that Xbox is also reducing layers of management to be quicker and more agile.
Earlier this year, Microsoft already had laid off around 6,000 employees in May, and another 300 staff members were terminated in June. The majority of these positions were in software engineering and product management.
Microsoft states that it will make high-performing teams by cutting down on managers and making teams more agile. Some fear that AI tools, which are now capable of writing a significant amount of code, could diminish the necessity of human software engineers.
While the company is eliminating positions in certain departments, it is still pouring massive amounts of money into artificial intelligence (AI), cloud computing, and emerging technology. Indeed, Microsoft is forecasting to spend some $80 billion on AI infrastructure such as data centers and computer chips during its most recent financial year.
Analysts think Microsoft is diverting attention to more profitable segments and reducing expenses in areas of the business that are not as rapidly expanding, including Xbox. This follows that Microsoft has acquired giant gaming firms like Activision Blizzard and Bethesda Softworks in recent years.
Overall, Microsoft explains these layoffs are needed to remain efficient and concentrate on its future in cloud technology and AI.
