Microsoft is reportedly planning to eliminate thousands of roles in various departments as part of efforts to restructure its workforce.
The layoffs are expected to affect employees in several business areas, including customer and partner solutions, engineering and consulting.
Sky news reports that Microsoft intends to cut 11,000 jobs, or around 5% of its workforce. According to the report, the company is expected to announce large-scale layoffs in the coming days.
Bloomberg reports, citing a source, that Microsoft plans to lay off employees in a number of its technical departments. according to a Bloomberg According to sources, this wave of cuts will be far larger than Microsoft’s last year.
A report from Business Insider said Microsoft can reduce its hiring team by up to a third.
The company is said to be “realigning businesses and roles” as it nears the end of its fiscal year. Microsoft is expected to release its second-quarter earnings next week.
According to documents, the company employed 221,000 full-time workers as of June last year, including 122,000 in the US and 99,000 abroad.
Microsoft is currently under pressure to maintain Azure’s growth rates after many quarters of declines in the PC market impacted Windows and device sales.
Microsoft’s current market value is $1.78 trillion. The company warned of a downturn in its cloud computing business in October, acknowledging that key enterprise customers are reassessing their investments in response to economic challenges.
“In a world of increasing headwinds, digital technology is the ultimate tailwind,” CEO Satya Nadella said in October.
“In this environment, we are focused on helping our clients do more with less while investing in sustainable growth areas and disciplined management of our cost structure.”
Microsoft has undergone a transformation under Nadella’s leadership, but recently the strength of the dollar has hurt its profitability. It’s also battling with regulators to get approval for a £56billion takeover of Call of Duty creator Activision Blizzard.
Last month, Microsoft bought a £1.5 billion stake in the company that owns the London Stock Exchange as part of a long-term cloud computing collaboration. Over the course of the alliance, the software company expects to generate $5 billion in revenue.
The latest round of layoffs at Microsoft could indicate that the tech sector may continue to shed jobs in the coming months.
Tens of thousands of jobs have been lost in the global tech industry in recent months due to sluggish sales and mounting fears of a recession.
According to tracking website Layoffs.fyitech companies laid off more than 150,000 people in 2022.
Facebook owner Meta said in November it would reduce its workforce by 13%. The announcement came shortly after Twitter cut almost half of its workforce following its October acquisition by multibillionaire Elon Musk.
Amazon, Salesforce, Arm, Twilio, and Oracle are among the other global tech companies that have announced job cuts and/or hiring freezes in the last six months.
