Microsoft to Lay Off Small Part of Workforce Based on Performance: Report

by gauravsinghigc

Tags : Microsoft layoffs, performance-based job cuts, tech workforce reduction, IT industry layoffs, corporate downsizing, employment trends, job market impact | Published at : 12 Feb 2025 01:55 AM | Author : Gaurav Singh (gauravsinghigc)

Microsoft is set to lay off a small portion of its workforce based on performance evaluations. The decision aligns with the company’s ongoing efforts to enhance productivity and cost efficiency in the tech sector.

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⚠️ Microsoft Confirms Performance-Based Job Cuts Across Departments

Microsoft has confirmed performance-based job cuts affecting a small percentage of employees across multiple departments. The move reflects the company’s ongoing focus on high-performance talent and operational efficiency.

📢 Microsoft’s Official Statement on Workforce Reduction

A Microsoft spokesperson stated:

“At Microsoft, we focus on high-performance talent. We are always working on helping people learn and grow. When people are not performing, we take the appropriate action.”

🔍 The layoffs will impact less than 1% of Microsoft’s workforce.
💼 Microsoft had a total of 228,000 employees as of June 2024.

📉 A Look at Microsoft’s Previous Layoffs

Microsoft’s latest job cuts are smaller in scale compared to its past downsizing efforts:

📉 In early 2023, Microsoft laid off 10,000 employees as part of a broader cost-cutting strategy.
🎮 In January 2024, following its $75.4 billion acquisition of Activision Blizzard, the company eliminated 1,900 jobs in its gaming division.

📊 Financial Performance & Market Trends

💰 Microsoft’s net income margin remains at nearly 38%, its highest since the early 2000s.
📉 Microsoft’s stock underperformed competitors in 2024, rising 12% while the Nasdaq gained 29%.

🤖 Microsoft & OpenAI: A Shifting Relationship

Microsoft’s evolving partnership with OpenAI has drawn attention in 2025:

💵 The company has invested over $13 billion in OpenAI.
⚖️ Over the summer, Microsoft officially listed OpenAI as a competitor.
📢 CEO Satya Nadella described the partnership as having "cooperation tension" in a recent investor podcast.

📢 Microsoft 365 Copilot: Underwhelming Rollout?

Despite Microsoft's AI investments, Microsoft 365 Copilot, which integrates OpenAI technology, has had a slower-than-expected rollout:

📉 UBS analysts noted that Copilot’s adoption has been "a bit slow/underwhelming".
🚀 Microsoft’s finance chief Amy Hood remains optimistic about Azure cloud AI growth in 2025.

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Microsoft layoffs, performance-based job cuts, Microsoft OpenAI partnership, Microsoft 365 Copilot adoption, Microsoft workforce reduction, Azure AI growth, tech industry job cuts, corporate restructuring, Blogs by Gaurav Singh (gauravsinghigc)