Microsoft confirmed that it will cut a series of staff in many departments based on their performance evaluations, in order to focus on restructuring the company.
Moving into 2025, Microsoft has made a move to lay off employees in many departments based on performance reviews: “When people aren’t performing, we’ll take appropriate action.”
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| Microsoft lays off a series of employees at the beginning of 2025 |
Microsoft asserts that the company will focus on high-performing talent. “We are always working to help people learn and grow. When people are not performing, we will take appropriate action.”
Microsoft's latest round of layoffs affects less than 1% of the company's 228,000 global employees as of six months ago. The exact number has not been disclosed, but the move is believed to be focused on employee performance.
Compared to previous layoffs, the cutbacks in early 2025 are much “softer.” For example, in January 2023, Microsoft laid off 10,000 people.
In January 2024, three months after Microsoft completed its blockbuster acquisition of Activision Blizzard, its gaming division also eliminated 1,900 people to avoid overlap. Then in June 2024, Microsoft announced another round of staff cuts, involving at least 2,500 employees.
The moves come as Microsoft's stock has fallen short of investor expectations, despite the company posting 12% revenue growth in its most recent quarter — about a percentage point higher than major competitors like Amazon and Google.
Over the past 12 months, Microsoft shares have risen 12.98%, well below Google’s 37.06% and Amazon’s 46.75%. However, the company still maintains its leading position with a market capitalization of $3.156 trillion, significantly higher than Google ($2.382 trillion) and Amazon ($2.335 trillion).
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