Microsoft Corp. plans to cut jobs in some engineering divisions there, according to people familiar with the matter, joining the ranks of the technology giants that are scaling back as the industry prepares for a prolonged slump in demand.
The size of the cuts was not immediately known, but the person, who asked not to be identified to discuss the matter, said the cuts would be bigger than any other round at Microsoft in the past year. The cuts affect less than 1% of the software giant’s workforce of more than 200,000.
Microsoft most recently cut its workforce in October and July, and has eliminated open positions and paused hiring in various groups. While technology peers such as Amazon.com Inc., Meta Platforms Inc. and Salesforce Inc. has announced thousands of layoffs in recent months, Redmond, Washington-based Microsoft is now taking smaller steps to address a worsening global problem. economic prospects and the potential for a protracted slowdown in demand for software and services.
A representative for Microsoft declined to comment. Shares, which have dropped 23% in the past year, were little changed at $240.16 at 15:06 in New York on Friday. Sky News previously reported that the company plans to cut thousands of jobs, and Insider reported that Microsoft could cut its hiring staff by a third.
Microsoft is expected to post a 2% sales gain in its fiscal third quarter when it reports earnings on January 24. This would be the slowest revenue increase since fiscal 2017. Since then, Microsoft’s cloud computing business has led a resurgence. , but even business that has started to decelerate in the past year.
However, the company has waited longer than other tech leaders to cut staff. Cloud rival Amazon is laying off more than 18,000 employees – the biggest reduction in its history. Meta’s parent Facebook announced widespread job cuts last fall, and social network Twitter Inc. has cut the workforce in half. Enterprise cloud software maker Salesforce laid off about 10% of its employees earlier this month.
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