Microsoft fires 4% of its workforce: Who are affected?
What's the story
Microsoft has announced a fresh round of layoffs, impacting as many as 9,000 employees or nearly 4% of its workforce. The move comes on the second day of the company's fiscal year 2026 and affects various teams across different geographies. This is not the first time this year that Microsoft has downsized its workforce. In January, less than 1% was cut based on performance.
Division affected
Job cuts in Xbox division
The latest layoffs have hit employees in Microsoft's Xbox division, Microsoft Gaming. Phil Spencer, the head of Xbox, informed his team about the changes. He said, "To position Gaming for enduring success and allow us to focus on strategic growth areas, we will end or decrease work in certain areas of the business and follow Microsoft's lead in removing layers of management to increase agility and effectiveness."
Past cuts
History of layoffs at Microsoft
The current round of layoffs follows a series of job cuts at Microsoft over the past year. In May, the tech giant cut more than 6,000 jobs and another 305 in early June.
Financial health
A look at the financial performance
Despite the job cuts, Microsoft has continued to perform well financially. For the March quarter, it reported almost $26 billion in net income on $70 billion in revenue. The numbers were well ahead of Wall Street's estimates, keeping Microsoft ranked as one of the most profitable firms in the S&P 500 index. Executives have projected around 14% year-over-year revenue jump for the June quarter, thanks to possible expansion in Azure cloud services and corporate productivity software subscriptions.