Microsoft to Lay Off Around Three Percent of Workforce in Organisation-Wide Cuts

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to Lay Off Around Three Percent of Workforce in Organisation-Wide Cuts

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 said on Tuesday it was laying off less than three percent of its workforce, or around 6,000 employees, as the technology giant looks to rein in costs while funneling billions of dollars into its ambitious bet on artificial intelligence.

The cuts will be across all levels and geographies and are likely the largest since

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laid off 10,000 employees in 2023. The company let a small number of staff go in January over performance-related issues, but the new cuts are not related to that, according to CNBC, which first reported the news.

Big Tech has been spending heavily on AI as they see the new technology as a major growth engine, while slashing costs elsewhere to safeguard profit margins.

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has also laid off hundreds of employees in the past year, as it looks to control costs and prioritise AI, media reports have said.

“We continue to implement organisational changes necessary to best position the company for success in a dynamic marketplace,” a 

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 spokesperson said on mail.

The company, which had 2,28,000 workers as of June last year, regularly uses layoffs to prioritise staffing in its main focus areas.

Tuesday’s move comes weeks after 

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 posted stronger-than-expected growth in its cloud-computing business Azure and blowout results in the latest quarter, calming investor worries in an uncertain economy.

But the cost of scaling its AI infrastructure has weighed on profitability, with 

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 Cloud margins narrowing to 69 percent in the March quarter from 72 percent a year ago.

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 has earmarked $80 billion (roughly Rs. 6,83,255 crore) in capital spending this fiscal year, with most of it aimed at expanding data centers to ease capacity bottlenecks for artificial intelligence services.

D.A. Davidson analyst Gil Luria said the layoffs showed 

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 was “very closely” managing the margin pressure created by its heightened AI investments.

“We believe that every year 

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 invests at the current levels, it would need to reduce headcount by at least 10,000 in order to make up for the higher depreciation levels due to their capital expenditures,” he said.

© Thomson Reuters 2025

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

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