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Microsoft to lay off more workers after deep cuts earlier this year

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Dive Brief:

  • Microsoft plans to lay off hundreds of workers as part of broader, ongoing organizational adjustments. GeekWire first reported the news Monday. 
  • The company plans to lay off at least 276 workers permanently, according to WARN notices filed Monday with labor authorities in Washington state, where the company is headquartered. Microsoft did not immediately respond to a request for comment. 
  • The software giant cut 5% of its workforce at the start of 2023, affecting around 10,000 employees, amid a push to align cost structure with revenue and demand.

Dive Insight:

The rate of workforce cuts, a major theme of 2023 in big tech, have slowed in recent months. But they haven’t gone away. 

Tech companies laid off more than 10,500 workers in June, down from nearly 15,000 in May, according to self-reported layoff tracking site Layoffs.fyi. However, the number of companies carrying out layoffs rose: 108 tech companies cut staff in June, compared to 94 in May. 

More than 216,000 tech jobs have been cut this year, according to the site. 

Microsoft’s recent workforce cuts follow the strategy announced in January by CEO Satya Nadella, who laid out efforts to better align costs, revenue and demand.

“We are taking a $1.2 billion charge in Q2 related to severance costs, changes to our hardware portfolio, and the cost of lease consolidation as we create higher density across our workspaces,” Nadella said in a blog post. 

During its most recent earnings call, Microsoft reported 22% growth in cloud revenue, a sign of stabilization after three consecutive quarterly contractions. The company saw overall revenues grow 7% year over year for Q3 2023, the three-month period ending March 31. 

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