Microsoft Announces Fresh Round of Layoffs, Impacting Thousands Globally

Toronto/July 2, 2025 

Microsoft has initiated another wave of job cuts, marking its second significant downsizing in recent months.

Layoff notifications began circulating on Wednesday, although the company did not specify the exact number of roles affected. However, Microsoft noted the reduction will involve fewer than 4% of its workforce compared to the same time last year.

This round of job losses will hit various departments across its global operations, including the company’s sales teams and its Xbox gaming division.

In a statement, Microsoft said, “We are continuing to make organizational adjustments to better align with current market dynamics and position our teams for long-term success.”

The largest layoff so far occurred in May, when around 6,000 employees—approximately 3% of Microsoft’s global staff—were let go. That move was part of a broader restructuring effort as the company increased its investment in artificial intelligence.

In June, Microsoft dismissed another 300 workers from its headquarters in Redmond, Washington. That followed nearly 2,000 job cuts in the Puget Sound area the previous month, based on official notices filed with Washington State.

The May layoffs predominantly affected software engineers and product managers, according to disclosures made to employment agencies in Washington and California. Offices in the San Francisco Bay Area were also hit.

On an earnings call in April, Microsoft CFO Amy Hood emphasized the company’s focus on streamlining its structure. “We’re building more agile, high-performing teams by removing unnecessary management layers,” she explained.

While Microsoft has maintained that these staffing changes are aimed at flattening the organization, some analysts are raising concerns about the impact of the company’s AI tools—particularly those capable of generating code—on traditional programming roles. In a statement earlier this year, CEO Satya Nadella said that for certain projects, “perhaps 20 to 30 percent of the code is already being generated by AI.”