Microsoft will eliminate about 4,800 jobs, or roughly 2.1% of its global workforce, as the software giant restructures parts of its commercial and Xbox businesses while continuing to invest heavily in artificial intelligence, according to a company blog post.
In a memo to employees, Chief People Officer Amy Coleman said the layoffs are intended to better align Microsoft’s workforce with changing customer demands and a rapidly evolving technology landscape.
She stressed that the eliminated roles “are not being replaced by AI,” while acknowledging that AI is reshaping how work gets done by automating some routine tasks and requiring employees to develop new skills.
Coleman said Microsoft redeployed more than 4,000 employees into new roles over the past year, including 500 this month, and noted that more than 30% of eligible employees accepted a recent voluntary retirement program. She added that additional organizational changes are expected across other parts of the company.
The cuts come as Microsoft and other technology companies continue to redirect spending toward AI infrastructure and products while reorganizing their workforces to support those priorities. Analysts have noted that although companies often say layoffs are not direct replacements by AI, many are reshaping their organizations around AI-driven workflows and automation.