Microsoft Corp. announced on Wednesday that it will lay off 10,000 employees as it prepares for a possible recession.
The layoff, which is far more significant than Microsoft's employment cutbacks from last year, adds to tens of thousands of job losses in the technology industry.
The tech company recorded a $1.2-billion loss as its cloud computing clients analyzed their expenditures, as reported by Reuters.
The software company has made significant investments in generative AI. Experts believe it could be a leader in its field, but the global economic downturn has hurt it.
Microsoft CEO Satya Nadella said in a memo to staff that fewer than 5% of the workforce will be affected by layoffs by the end of March, with notices starting on Wednesday.
Tech Industry Threatened By Global Recession
With many having hired tens of thousands more workers during the pandemic, many technology corporations were obliged to react to warnings of a worldwide economic downturn.
Several major IT firms have been laying off workers as of late, with Amazon announcing this month that it would be cutting 18,000 positions, or around 6% of its employees, Sky News reported.
The cloud computing company Salesforce said it would eliminate 8,000 employees, while Facebook's owner, Meta, is laying off around 11,000 workers.
Microsoft's shares, which have lost 23% over the last year, were almost unchanged at $240.35 as of Tuesday's New York market closing.
When Microsoft releases its results on January 24, it is anticipated to show a 2% increase in revenue for the fiscal second quarter. The sales growth would be the smallest since fiscal year 2017. Microsoft's cloud-computing business has revived expansion since then, although it has weakened in the last year, per Bloomberg.
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