Microsoft announced Wednesday that it would lay off 10,000 staff members through March 31 as the software company prepares for weaker revenue growth. The corporation will take a $1.2 billion charge in the second quarter of its fiscal year, which would reduce profits per share by 12 cents.
A memo by CEO Satya Nadella was posted on Microsoft’s website announcing that some employees will find out that they are losing their jobs starting this week. Nadella had hinted that the company might need to make changes. He said in an interview with CNBC-TV18, “I think for us as a global company, we’re not going to be immune from what’s happening in the macro. We will have to also get our own sort of operational focus on making sure our expenses are in line with our revenue growth.”
In July 2022, Microsoft said it would trim less than 1% of employees, confirmed in October last year when less than 1,000 workers were laid off. This year’s move will reduce the company’s headcount by less than 5%.
Based on an interview with a company spokesperson to CNBC, the workforce adjustment will affect all teams and geographies, primarily affecting the sales and marketing departments.
He also said, “I’m confident that Microsoft will emerge from this stronger and more competitive.”
Technology companies have also lowered their headcounts recently, including Alphabet, Amazon, and Salesforce. The decline is caused by the increasing demand for cloud computing and collaboration services as businesses, authorities, and educational institutions encouraged remote work to lessen Covid exposure.
