Microsoft to cut thousands of jobs across divisions, today
By Republic Aeon Web Desk: Companies like Amazon.com Inc. (AMZN.O) and Meta Platforms Inc. (META.O) have announced layoffs in reaction to sluggish demand and a deteriorating outlook for the global economy. The anticipated layoffs would be the latest in the U.S. technology sector.
According to reports in the media on Tuesday, Microsoft is getting ready to eliminate additional positions from its global workforce as tech giants continue to reduce headcount to weather difficult economic conditions.
According to Bloomberg News, the well-known company in the computer industry may announce layoffs in its engineering divisions as early as Wednesday.
AFP was informed by a Microsoft spokesperson that the company would not respond to the quot;rumor.quot;
The company, which is based in Washington state and has more than 2,20,000 employees, according to industry trackers, cut its workforce twice last year.
A week before Microsoft’s earnings report for the final three months of the previous year, the company would make another announcement about layoffs.
In a note to investors, Wedbush analyst Dan Ives stated, quot;Over the last few weeks we have seen significant headcount reductions from stalwarts Salesforce and Amazon.quot; Ives informed investors that Wedbush is anticipating additional staff reductions of 5 to 10% in the technology industry.
Many of these corporations were spending money like rock stars in the 1980s, according to Ives, who stated that they now need to tighten up on expense management in anticipation of softer macroeconomic conditions. quot;The uncertain economyquot; and the fact that Amazon had quot;hired rapidly quot; during the pandemic were cited as reasons for the company’s decision to lay off more than 18,000 employees at the beginning of January.
The plan to cut jobs is the largest of the recent layoffs that have affected the once-unstoppable US technology sector, including giants like Meta, which owns Facebook.
In a statement to employees, Amazon CEO Andy Jassy said that some of the layoffs would take place in Europe. He also said that the affected employees would be informed starting on January 18.
Advertisers are cutting costs in response to inflation and are cutting budgets for major platforms based on an advertising-based business model.
Meta made the news in November that it would be cutting 11,000 jobs, or about 13% of its workforce. About 1,200 people, or 20% of Snapchat’s workforce, were laid off at the end of August.
In addition, at the beginning of January, the IT company Salesforce made the announcement that it would be laying off approximately 10% of its employees, or just under 8,000 people. In October, billionaire Elon Musk purchased Twitter, and he promptly laid off approximately half of the social media platform’s 7,500 employees.
By tomorrow, Microsoft will announce job cuts. According to Sky News, the software company will reportedly eliminate thousands of positions and aim to slash about 5% of its workforce. That could result in more than 10,000 layoffs at Microsoft, which has more than 220,000 employees.
The Verge is told by a person who is familiar with Microsoft’s plans that the company will likely announce layoffs on Wednesday, prior to its quarterly earnings next week. Sky News does not specify a specific date for the anticipated cuts.
According to reports, the layoffs are quot;significantly larger quot; than the 1% reduction in Microsoft’s workforce that occurred last year. Consulting, customer and partner solutions positions were affected by the previous job cuts.
Microsoft is the latest major tech company to face a difficult economy, and the layoffs will occur just a few days after the company introduced a new policy that allows employees unlimited time off. In April, managers will be able to grant unlimited quot;Discretionary Time Off quot; to Microsoft employees who have not used their vacation time.
Additionally, the reductions occur just a few weeks after Microsoft CEO Satya Nadella predicted that the technology sector would face difficulties for two years to come. In an interview with CNBC, Nadella acknowledged that Microsoft was not quot;immune to the global change quot; and emphasized the significance of efficiency for technology companies.
Nadella stated, quot;The next two years are probably going to be the most challenging.quot; During the pandemic, we experienced a lot of acceleration, and that demand has begun to normalize in some way.
Additionally, there is a genuine recession in some regions of the world. After Windows and devices sales suffered during several quarters of a downturn in the technology market, Microsoft is under pressure to maintain growth rates at its cloud unit.
In July of last year, it stated that a few roles had been eliminated. Microsoft did not respond to any requests for comment.