Microsoft To Fire 10,000 Employees As It Joins Global Tech Layoffs
Microsoft has joined the likes of tech giants Meta, Amazon and Twitter in cutting costs amid global macro uncertainty.
Microsoft Corp. will lay off about 10,000 employees by the end of March, joining the likes of tech giants Meta Platforms Inc., Amazon.com Inc. and Twitter Inc. in cutting costs amid global macro uncertainty.
The company is "making changes that will result in the reduction of our overall workforce by 10,000 jobs through the end of FY23 Q3", Chief Executive Officer Satya Nadella said in a communication with Microsoft employees.
"This represents less than 5% of our total employee base, with some notifications happening today. It’s important to note that while we are eliminating roles in some areas, we will continue to hire in key strategic areas," he said.
"As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less. We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one," Nadella added.
He added that the changes in order are in "the context in which we as a company must strive to deliver results on an ongoing basis." Microsoft is slated to announce second-quarter results on Jan. 24.
In line with trend across the tech industry about focusing on core areas and restructuring, Nadella said the company will now allocate "capital and talent to areas of secular growth and long-term competitiveness for the company, while divesting in other areas."
Due to these, the company will incur a $1.2 billion (around Rs 9,700 crore) charge in Q2 related to severance costs, hardware portfolio, and the cost of lease consolidation as it creates "higher density across workspaces."
Global Tech Pain
Microsoft's actions come as tech valuations have drawn down and layoffs as a cost cutting measure become commonplace. While Meta let about 11,000 go, Amazon announced around 18,000 jobs cuts globally last year. Elon Musk has cut strength across Twitter's offices worldwide, with as many as 90% fired in India.
Closer home, India's new-age companies have also resorted to layoffs, with Byju's, Ola, Unacademy, ShareChat, GoMechanic, among other having to adjust to a changed macro backdrop and tougher access to capital.