Microsoft is set to eliminate several thousand positions, primarily within its sales division, as the company continues to restructure its team while increasing spending on artificial intelligence initiatives. According to a Bloomberg report citing unnamed insiders, the layoffs are expected to be disclosed in early July, shortly after Microsoft closes out its fiscal year 2025 on June 30.
The technology giant has significantly ramped up its investment in artificial intelligence, allocating $80 billion in capital spending for the current fiscal year. This substantial investment is largely dedicated to building out data center infrastructure to address capacity challenges related to its AI operations. As of June 2024, Microsoft employed a total of 228,000 people, with around 45,000 working in sales and marketing – a figure that remained unchanged from the previous year.
This workforce segment represents the company’s third-largest group, following Operations with 86,000 employees and Product Research and Development with 81,000 staff members. When approached for comment, a Microsoft representative stated that there were no updates to share regarding potential staffing changes.
The news comes as other tech giants are also navigating the impact of AI on their workforce. Amazon CEO Andy Jassy recently noted that the rollout of generative AI and agents will reduce the company’s total corporate workforce in the next few years. He emphasized the transformative potential of generative AI, highlighting its integration into various aspects of Amazon’s ecosystem, from Alexa to shopping tools and backend processes.
As businesses across sectors race to embed AI into their offerings to stay competitive, Microsoft is striving to reinforce its dominant position in the market. The company’s strategic focus on AI development and infrastructure is clear, even as it undergoes restructuring efforts that include significant job cuts in certain divisions.
