Due to various economic factors, it looks like Microsoft‘s cutting costs by laying off a whopping 10,000 of its employees. The Microsoft layoffs are set to begin on Wednesday, with the goal of completing the process by around March. For reference, the tech giant had around 221,000 workers by the end of June last year.
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A few factors resulted in the final decision to lay off this many workers. According to Microsoft Chief Executive Satya Nadella, the company is looking to prepare for an uncertain economy.
“These are the kinds of hard choices we have made throughout our 47-year history to remain a consequential company in this industry that is unforgiving to anyone who doesn’t adapt to platform shifts.”
Aside from a potential economic recession, Microsoft also bit off a bit more than it could chew by hiring more than 75,000 people since 2019, around the time when the COVID pandemic occurred. Microsoft wasn’t the only company that overhired, and as the need for technical talent waned, so too did the need for tens of thousands of extra workers.
It’s worth noting that Microsoft isn’t simply trying to cut costs. Rather, the company is currently trying to invest in other technologies and projects instead. The tech giant is investing in OpenAI, the company behind the ChatGPT AI system, and in the video game sphere, it’s looking to acquire Activision Blizzard in a $69 billion dollar deal.
Source: The New York Times
Update: It seems like the Microsoft layoffs have affected the company’s video game division, according to a report from Bloomberg. The report claims that people familiar with the matter have stated the layoffs will also affect Bethesda Game Studios (Starfield, Fallout) and 343 Industries (Halo Infinite). This includes industry veterans who have worked in Xbox for more than a decade. ZeniMax Media, Bethesda’s parent company, refused to comment on the matter.
Source: Bloomberg