Microsoft to Cut Thousands More Jobs Amid Soaring AI Investment

Tech Giant Prepares for Another Wave of Layoffs as AI Reshapes Its Priorities

Microsoft is planning another round of major job cuts, this time focusing on its sales division, according to reports from U.S. media on June 18. These layoffs, expected to begin in early July, come on top of the approximately 6,000 layoffs already executed in May. Although Microsoft remains highly profitable, the company is under increasing financial pressure due to its massive investments in artificial intelligence (AI). By trimming workforce expenses, the tech giant hopes to balance its ambitious AI growth strategy with operational efficiency.

While the exact number of layoffs hasn’t been confirmed, they will likely coincide with the beginning of Microsoft’s new fiscal year in July. The company has yet to comment publicly, despite inquiries from news outlets like the Nikkei. As of June 2024, Microsoft employed around 228,000 people globally, with approximately 45,000 working in its sales and marketing departments. The layoffs in May had primarily targeted software engineers and middle management roles.

Microsoft is still adjusting from its hiring surge during the COVID-19 pandemic, which led to an earlier layoff of 10,000 employees globally in 2023. Since then, the company has continuously fine-tuned its workforce to rein in labor costs while funneling resources into next-gen infrastructure. Notably, Microsoft plans to invest a staggering \$80 billion (approx. ¥12 trillion) into data centers for AI-related expansion in fiscal 2025.

Despite these cuts, Microsoft’s financial performance remains stellar. The company posted a record-breaking net income of \$25.8 billion for the January–March 2025 quarter. Its stock price reached an all-time high of \$481 during June 18 trading on the U.S. market, boosting Microsoft’s market capitalization to over \$3.5 trillion—placing it marginally ahead of chip giant NVIDIA as the world’s most valuable company.

What Undercode Say:

Microsoft’s strategic layoff plan illustrates a broader truth about the modern tech economy: profitability doesn’t preclude austerity. On the surface, the move may seem paradoxical—record profits and skyrocketing stock value paired with sweeping job cuts—but this decision aligns with a deep recalibration in the tech industry. We’re witnessing a transition from labor-heavy innovation to capital-intensive, AI-driven infrastructure investment.

AI is not just a buzzword for Microsoft—it’s the center of gravity for its future. The \$80 billion commitment to data centers isn’t just a number; it’s a signal to investors, competitors, and policymakers that Microsoft is all-in on AI. However, this pivot comes with trade-offs, and human capital is often the first casualty. Sales departments, traditionally vital to enterprise revenue pipelines, are now being scrutinized for efficiency in a world where AI can increasingly handle customer insights, lead qualification, and even automated deal flows.

Let’s not overlook the timing either. Microsoft’s fiscal calendar reset provides a clean slate for restructuring, a common strategy for large corporations aiming to re-align resources without disrupting quarterly reporting cycles. These planned layoffs are not reactive, but premeditated and systemic.

This also fits a broader trend among Big Tech giants. Google, Amazon, Meta, Apple—all are slimming down in non-core divisions while doubling down on AI, cloud, and semiconductors. It’s a game of long-term dominance, where leaner operations and massive capital deployments are the new norm.

For employees, however, this heralds an uncomfortable reality. Job security in tech is no longer guaranteed by company profitability. Instead, it hinges on alignment with corporate vision—mainly, AI relevance. Sales and marketing roles are now at risk of becoming redundant if they don’t evolve alongside emerging technologies.

Moreover, Microsoft’s silent stance on the matter suggests a calculated PR move. Silence minimizes backlash, especially when layoffs are happening amidst record highs. It’s corporate optics: don’t let good news get overshadowed by grim headlines.

But the ripple effects go beyond Microsoft. When the world’s largest tech firm tightens its belt despite swimming in profits, smaller firms follow suit. It sets a precedent: AI is not just enhancing business—it’s replacing business as usual.

🔍 Fact Checker Results:

✅ Microsoft is indeed planning additional layoffs in July, as reported by Bloomberg and Nikkei.

✅ The company posted a record Q1 2025 profit of \$25.8 billion, confirming its strong financial standing.

✅ Microsoft’s \$80 billion AI infrastructure investment for FY2025 has been officially disclosed in investor briefings.

📊 Prediction:

If Microsoft’s AI investments start yielding visible enterprise applications—such as Copilot integrations or Azure AI expansions—the company could streamline even more departments by late 2025. Expect a second wave of automation-led restructuring in areas like customer support, operations, and even parts of engineering. The tech workforce of tomorrow will need to be AI-native or risk being obsolete.