Microsoft to Cut 9,000 Jobs Worldwide as New Fiscal Year Begins
Quick Take
About 9,000 roles to go – just under 4 % of Microsoft’s global workforce. \
Cuts span all regions and job levels, from engineering to back‑office functions.
Goal: flatten management layers and speed up decision‑making.
Latest in a series: ~6,000 jobs were lost in May and “hundreds” more in June, on top of minor performance‑based cuts in January.
Context: Microsoft still posted a £20 bn‑plus* net profit on £55 bn revenue last quarter and its shares hit a record $497.45 on 26 June.
*Converted at £1 = $1.28 for readability.
What Has Microsoft Announced?
On the second day of its 2026 financial year, Microsoft confirmed plans to eliminate roughly 9,000 jobs worldwide. The company says the reorganisation will “best position teams for success in a dynamic marketplace” – corporate‑speak for slimming down layers of management while keeping frontline technical talent.
Where Will the Axe Fall?
Functions affected: engineering, sales, marketing, support and corporate operations
Geographies: job cuts are spread across the Americas, EMEA and Asia‑Pacific rather than concentrated in one hub
Seniority: both junior contributors and senior managers are included, but the focus is on trimming middle‑management “layers” to speed up decision‑making.
Phil Spencer, CEO of Microsoft Gaming, told Xbox staff the division will “end or decrease work in certain areas … and remove layers of management to increase agility.”
Why Now?
Cost discipline – Microsoft is ploughing tens of billions into AI infrastructure and wants to fund that spend from efficiency gains.
Flatter hierarchy – fewer reporting layers mean faster product cycles, vital as cloud‑AI rivals move quickly.
Seasonal timing – major restructures traditionally land at the start of Microsoft’s fiscal year, giving teams 12 months to deliver against the new plan.
A Year of Serial Redundancies
| Month 2025 | Estimated roles cut | Details & focus | Source |
|---|---|---|---|
| Jan | < 1 % of head‑count (≈2,000) | Performance‑based exits | theverge.com |
| May | ~6,000 | Reduction of management layers | bloomberg.com |
| June | “Hundreds” | Follow‑up to May cull | bloomberg.com |
| July | 9,000 | Global restructure | reuters.com |
For perspective, Microsoft’s largest lay‑off was in 2014, when 18,000 jobs went after the Nokia handset acquisition.
Financial Picture Remains Rosy
Q3 FY25 (Jan‑Mar) results: $70.1 bn revenue (+13 % YoY) and $25.8 bn net income (+18 %).
Cloud still soaring: Azure revenue jumped 33 % last quarter.
Record share price: Microsoft closed at $497.45 on 26 June, before dipping slightly on the lay‑off news.
Bottom line: the cuts are about efficiency, not survival.
Job‑Cut Fever Across Software
Microsoft is not alone. Other 2025 tech lay‑offs include:
Autodesk – 9 % of staff in a restructuring push.
Chegg – 22 % (248 roles) amid AI‑driven disruption to ed‑tech.
CrowdStrike – 5 % (≈500 roles) to curb costs while reaffirming forecasts.
An ADP report on the same day showed the wider U.S. private sector lost 33,000 jobs in June, defying forecasts for growth.
What Happens Next?
Severance & support: Microsoft has yet to publish full severance terms, but previous rounds offered at least 60 days’ continued pay and six months of health cover in the U.S.
Role reallocations: Staff in critical AI or cloud roles may be offered redeployment rather than redundancy.
Investor watchpoints: Analysts will scrutinise Q4 FY25 results in late July to gauge whether head‑count savings flow through to margins.
Sources
All facts have been verified against publicly available reports from Reuters, Bloomberg, CNBC, TechCrunch, The Verge, Channel Futures, MarketWatch and Microsoft investor filings.