Azernews.Az

By Alimat Aliyeva

The latest round of layoffs at Microsoft marks the fourth such round this year, Azernews reports.

In January, the company announced a 1% reduction in its workforce. In May, Microsoft laid off more than 6,000 employees, and in June, another 300 workers were let go.

According to Reuters, Microsoft has committed to spending $80 billion on capital expenditures for the 2025 fiscal year. However, the escalating costs of building AI infrastructure for Azure appear to have significantly impacted the company’s margins. This is believed to be one of the key reasons behind the recent job cuts.

On Wednesday, Microsoft revealed plans to "reduce its organizational levels," which will involve eliminating certain senior positions, such as managers, and simplifying its products, procedures, and roles. This round of layoffs is the largest since 2023, when the company slashed 10,000 jobs.

The first report on these layoffs came from The Seattle Times. Bloomberg later added that Microsoft’s King division, based in Barcelona and responsible for the popular mobile game Candy Crush, would undergo a restructuring in June, resulting in a 10% reduction, affecting at least 200 employees.

The Xbox division has also been hit hard by these cuts. Xbox CEO Phil Spencer sent an email to staff, as reported by Insider Gaming, acknowledging that while the company has seen growth in players, games, and hours played, the layoffs are a necessary step to ensure the company’s long-term success.

Microsoft is not alone in making these tough decisions. As the competition for dominance in artificial intelligence heats up, many tech giants are prioritizing AI advancements, often at the cost of human resources. This trend has led to widespread layoffs across the sector.

Meta, the parent company of Facebook, announced earlier this year that it would cut around 5% of its workforce in departments deemed "lower productivity." Similarly, Alphabet, the parent company of Google, has carried out hundreds of layoffs over the past year, as it increasingly focuses on leveraging AI and building its own AI infrastructure.

As AI continues to disrupt industries, it seems that cost-cutting measures, particularly through workforce reductions, are becoming the norm for companies navigating this new tech frontier.