Report: Microsoft planning cuts; Employees facing the threat of layoffs

Microsoft employees are facing the threat of layoffs, as the tech giant plans to let go of thousands of its workforce, particularly in the sales department. Bloomberg News reported this on Wednesday (local time), citing sources familiar with the situation. 

According to the report, this decision is driven by the company's intention to invest more in Artificial Intelligence (AI) while aiming to create a smaller, more effective team. Earlier in May, Microsoft laid off approximately 6,000 employees. 

The tech giant has significantly increased its investment in AI to strengthen its leadership position, as businesses across various industries increasingly incorporate AI into their products and services to maintain a competitive edge.

Amazon CEO Andy Jassy stated on Tuesday (local time) that the company's workforce may face reductions in the coming years due to generative AI and new technologies. Microsoft plans to invest around $80 billion this fiscal year, with most allocated to building data centers to enhance AI services. 

Per the report, the new layoffs may be announced next month, in early July, coinciding with the end of Microsoft's financial year; however, the company has not issued any official statement on this matter. Additionally, the report indicated that the job cuts would not be limited to the sales team and could also impact other departments, though it remains undecided how many employees will lose their positions. Notably, as of June 2024, Microsoft employed 228,000 people.