Microsoft Confirms Over 6,000 Job Cuts in Latest Round of Global Layoffs
In a significant move aimed at streamlining its operations, Microsoft has confirmed plans to lay off around 6,000 employees—roughly 3% of its global workforce. The layoffs will span multiple departments and affect employees across various levels, including those at LinkedIn, the company’s professional networking arm.
The Redmond-based tech giant, which employed approximately 228,000 people globally as of June 2024, stated that the decision is part of a broader restructuring effort to simplify its organizational structure and improve agility in a competitive and rapidly evolving technology landscape.
Focus on Efficiency Over Expansion
A Microsoft spokesperson noted that the company is continuously evaluating its structure to ensure long-term success. “These changes are necessary to position ourselves for future growth and innovation,” the spokesperson explained, emphasizing the need to reduce redundant management layers.
While exact departmental breakdowns weren’t disclosed, sources suggest that middle management roles are expected to take the brunt of the hit, aligning with Microsoft’s ongoing strategy to expand managerial “spans of control” and prioritize engineering talent—especially in areas related to artificial intelligence and cloud services.
Strategic Shift Amid Rising AI Investments
This restructuring comes on the heels of Microsoft’s massive financial commitment—nearly $80 billion—for building data centers and boosting AI capabilities through Azure, its cloud computing platform. As the company continues to bet big on generative AI and enterprise automation, it is also reshuffling internal responsibilities, including outsourcing small business sales to external firms.
The layoffs also follow Microsoft’s better-than-expected quarterly earnings in April 2025. While core Azure services showed strong performance, non-AI growth areas underperformed, prompting further sales and structural changes.
Performance Management Gets a Tougher Overhaul
This round of layoffs isn’t just about cutting roles—it’s part of a deeper transformation in Microsoft’s employee management strategy. Internal reports reveal the implementation of a rehire ban for underperforming employees exiting under performance-related terms, and a more aggressive system for tracking what Microsoft terms “good attrition”—departures considered beneficial to team efficiency.
Employees with performance issues now face a stark choice: either enter a performance improvement plan (PIP) with set goals and deadlines or accept a severance package through a voluntary separation program. However, once an employee opts for the PIP, they forfeit any severance benefits—a shift echoing policies at other tech firms like Amazon and Meta.
Broader Industry Trend Toward Leaner Teams
Microsoft’s decision is not an isolated event—it reflects a wider transformation in the tech sector where companies are shedding layers of management to operate with more agility. Competitors such as Meta, Salesforce, and Amazon have also trimmed their workforces this year, with similar motivations: reallocating resources toward AI, reducing operational costs, and driving performance-based accountability.
The last major layoff at Microsoft occurred in January 2023, when 10,000 roles were eliminated, many of them in hardware and emerging technologies like HoloLens. While that cut was focused on business refocusing, the 2025 layoffs seem more systemic, signaling a shift in how Microsoft defines productivity and success.
As tech giants embrace what Meta has dubbed a “year of efficiency,” Microsoft’s recent actions make it clear: in the era of AI-driven transformation, agility and performance now outweigh scale.
