Microsoft Confirms 10,000 Layoffs Amid Recession, Plans to Invest Heavily in AI
Yesterday we reported that Microsoft may announce the retirement of 10,000 positions this week.In a note sent today (opens in new tab) To all Microsoft employees, CEO Satya Nadella confirmed the disappointing news.
To put the layoffs in perspective, Nadella explained:[We’re] With some parts of the world in recession and recessions expected in others, we are seeing organizations across all industries and geographies paying attention … As a company, we are: We must invest in long-term opportunities while striving for sustained results. “
The job cuts Nadella says represent just under 5% of the global footprint of 220,000 employees and will occur between now and the end of Microsoft’s fiscal third quarter (March 31, 2023). increase. Unfortunately, some employees will receive notice of their layoffs as early as today, while others face their fate with the company in the days or weeks to come.
Mass layoffs mean Microsoft will incur $1.2 billion in expenses during the third quarter, partly to cover employee retirement packages. Speaking of which, Microsoft says it will provide a retiring employee with “above-market retirement benefits,” six months of ongoing medical care, plus he has six months of stock vesting.
“As a company, our success must match the success of the world,” continued Nadella. “This means that each of us and every team across the company must raise the bar and outperform the competition … If we do this, we will be stronger and stronger in the future. You’ll thrive for a long time, and it’s as easy as that.
Despite this massive job cut, Microsoft “will continue to hire in key strategic areas.”Nadella boasted CNBC interview two weeks ago He has been on India for a “very long time” and envisions a country that by 2030 will rise from its current fifth largest economy to the third largest in the world economy. “In a difficult world, India is an exception.”
Artificial intelligence is the next big mountain to climb in computing, and India is number one in this area. So it should come as no surprise that India will play a key role in Microsoft’s more selective new hires in the coming months and years.
10,000 layoffs is a big number, but not the biggest in the company’s history. Microsoft said he cut 18,000 positions in 2014. However, it should be noted that layoffs occurred during the former CEO’s transition from his Steve Ballmer to his Nadella. Moreover, two-thirds of that figure is due to employees laid off following Microsoft’s doomed acquisition of Nokia Devices and Services.
Microsoft isn’t the only tech company feeling the heat of a slowing economy.Amazon is proceeding laid off 18,000 employeeswhile Facebook’s parent meta is Farewell to 11,000 workers.
