Microsoft CEO Addresses Recent Layoffs in Town Hall Meeting
Microsoft CEO Satya Nadella has spoken out for the first time following the company’s recent decision to cut approximately 6,000 jobs, about three percent of its global workforce. In a companywide town hall meeting, Nadella emphasized that the move was part of a broader internal restructuring and not a reflection on employee performance.
The layoffs primarily affected engineering roles, a notable development given their traditional perception as secure positions. Nadella explained that the job cuts were necessary to realign teams according to Microsoft’s evolving priorities, particularly its growing focus on artificial intelligence. He acknowledged the emotional toll of the decision but underscored that it was driven by strategic shifts rather than shortcomings in productivity or talent.
During the same internal event, executives highlighted Microsoft’s significant momentum in selling AI tools to enterprise customers. Chief Commercial Officer Judson Althoff revealed that British banking giant Barclays has committed to purchasing 100,000 licenses for Microsoft Copilot, the company’s flagship AI assistant. Other major global firms, including Accenture, Toyota, Volkswagen, and Siemens, now each have over 100,000 users of Copilot within their organizations.
Nadella stressed the importance of tracking how deeply Copilot is embedded across client operations, with Microsoft paying close attention to the proportion of users actively engaging with the tool. At a list price of $30 per user per month, the scale of these contracts suggests annual revenues in the tens of millions of dollars, although actual figures are likely reduced by bulk pricing agreements.
The developments reflect Microsoft’s pivot toward enterprise AI as a key growth area, even as the company trims its workforce to maintain efficiency and focus. This strategic shift highlights a broader trend in the tech industry, where even product development teams are being reshaped amid the accelerating integration of AI technologies.
