CEO Satya Nadella warns the next two years being “the most challenging” as Microsoft reportedly plans 11,000 jobs cuts

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Microsoft joins the growing list of companies prepping for potential recession by laying off sizeable portions of their labor force.

According to a Sky News report, Microsoft is planning to cut up to 5 percent or more of its workforce which roughly equates to 11,000 jobs. Several sources point to January 18, 2023 (tomorrow) as the scheduled D-Day for the company’s jobs cut despite not having any concrete insight into the total number of jobs on the chopping block.

Thanks to SEC filing back in June of 2022, Microsoft’s total number of employees has been revealed to be 221,000 full-time employees around the world with a breakdown of 122,000 just in United States alone. The news about layoffs follows an unprecedented employee growth Microsoft experienced in 2022, adding over 40,000 jobs over the course of the year.

A large portion of the 11,000 jobs being nixed in this round of layoffs are said to be engineering jobs with one person familiar with the planned downsizing citing a cut to Microsoft’s recruiting staff by as much as one-third as another possible area targeted for trimming while the company continues its hiring freeze.

While Microsoft relatively quietly let go 1,000 employees back in early October of 2022, the company has, in recent years, reserved its large-scale downsizing projects for the Summer following its third quarter earnings report. Microsoft will be set to report its Q2 earnings results on January 24, 2023.

In an interview a week ago on CNBCTV18, Microsoft CEO Satya Nadella explained that the tech sector will be undergoing tumultuous times through 2025 and that the “next two years are probably going to be the most challenging.”

While not very reassuring, Nadella also added, “In the long run, all those employees in all those industries are going to consume more tech infrastructure … There’s more employment outside of the tech industry of technical talent. And so that’s I think what we’re banking on.”

Nadella’s comments were made over five days ago and in light of today’s report, it would seem he was preparing the market for Microsoft’s downsizing news this week.

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