NEW YORK, NY - APRIL 29: A Microsoft corporate logo hangs on the side of their office building on Eighth Avenue on April 29, 2023, in New York City. (Photo by Gary Hershorn/Getty Images)
Redmond, Washington – Microsoft has begun another sweeping round of layoffs, cutting approximately 9,000 employees across multiple divisions in what marks the company’s second major workforce reduction this year.
The move, which Microsoft said represents just under 4% of its global headcount, follows previous layoffs in May and June that together eliminated over 6,300 positions. Combined with earlier cuts this year, Microsoft has now laid off more than 15,000 employees in 2025 alone—putting this year’s job losses on track to match some of the largest reductions in the company’s history.
The layoffs come just days into Microsoft’s 2026 fiscal year, a time traditionally marked by corporate restructuring. In a statement, the company said it is continuing to make “organizational changes necessary to best position the company and teams for success in a dynamic marketplace.” Microsoft declined to comment on the exact number of positions being cut, but filings and internal memos suggest a broad impact.
Teams affected include sales, software engineering, and product management, as well as Microsoft’s Xbox gaming division. Phil Spencer, CEO of Microsoft Gaming, wrote in a memo to staff that the company would be “ending or decreasing work in certain areas” to focus on strategic growth. “We will follow Microsoft’s lead in removing layers of management to increase agility and effectiveness,” Spencer said.
Microsoft employed 228,000 full-time workers globally as of June 2024. This week’s cuts, representing roughly 4% of that number, mirror the company’s actions in 2023, when it eliminated 10,000 positions. The company’s largest-ever layoff occurred in 2014, when it cut 18,000 jobs following its acquisition of Nokia’s devices and services business.
Despite the job losses, Microsoft continues to post strong financial performance. In its most recent earnings report, the company reported nearly $26 billion in net income on $70 billion in revenue for the March quarter, beating analyst expectations. The company expects 14% year-over-year revenue growth in the current quarter, driven by its Azure cloud platform and software subscriptions for business.
Microsoft’s stock closed at a record $497.45 per share on June 26. But the announcement of layoffs appeared to slightly dampen investor sentiment. Shares slipped 0.6% in early trading Wednesday, while the S&P 500 index remained largely flat.
Microsoft’s latest layoffs arrive as broader labor market signals show signs of stress. On Wednesday, payroll processing firm ADP reported that the U.S. private sector lost 33,000 jobs in June—far below economists’ expectations of a 100,000-job gain. Other software firms including Autodesk, Chegg, and CrowdStrike have also trimmed staff in recent months.
While Microsoft’s executives say the cuts are about streamlining operations and maintaining competitiveness, the scale and pace of job losses this year underscore the growing tension between corporate profitability and workforce stability in the AI-driven era.
