Microsoft Slashes 9,000 Jobs as Company Doubles Down on A.I. and Efficiency
Microsoft has confirmed it will lay off about 9,000 employees, or just under 4% of its global workforce, as it starts its new fiscal year.
This is the company’s second major round of job cuts in 2025 and follows more than 6,000 layoffs in May. The company has now cut over 15,000 jobs since January 2024.
The layoffs affect workers in many parts of the company, including sales, marketing, engineering, and especially the gaming division. The Xbox team, along with King (the maker of Candy Crush) and Zenimax in Europe, will see some of the largest reductions.
King will lose about 200 jobs, which is 10% of its staff. These cuts are not limited to one region or one type of job. Microsoft says the layoffs reach across departments and experience levels.
Microsoft says it is not laying off workers because of poor performance. Instead, the company wants to make its structure simpler and reduce the number of management layers.
By doing this, Microsoft hopes to make decisions faster and keep up with changes in the tech world. The company is also trying to save money as it invests heavily in artificial intelligence and new data centers.
Microsoft plans to spend $80 billion this year on AI infrastructure, which is a record for the company. Even with these job cuts, Microsoft is still performing well financially.
The company reported $25.8 billion in profit in its most recent quarter, up 18% from last year. Microsoft’s stock price has stayed strong, and the company remains one of the most profitable in the world.
The layoffs come at a time when Microsoft’s gaming business is growing, with more players and games than ever before. However, the company says it must focus on the areas that matter most for future growth.
This means some projects and teams will shrink or close, and some middle management jobs will disappear. Microsoft’s approach is part of a larger trend in the tech industry.
Many big technology companies are cutting jobs to stay competitive and invest in new technologies like AI. Since the start of 2025, tech companies have cut over 83,800 jobs.
Microsoft says affected employees will get severance pay, health coverage, and help finding new jobs. The company promises to give priority to those who want to apply for other roles within Microsoft Gaming.
The real story is that Microsoft, while still very profitable, is changing how it does business. The company is cutting jobs to put more money into new technology and to make its organization faster and more efficient.
This is a sign of how quickly the tech world is changing, and it shows that even the biggest companies must adapt to keep growing.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief