Microsoft announced large-scale staff reductions, laying off approximately 4,800 employees. This accounts for about 2.1 percent of the company's total workforce.
Reasons and Focus of Changes
Microsoft stated that this decision was made to adapt the company to the rapidly changing world of artificial intelligence (AI). The company emphasized that this is not merely a cost-cutting measure but a process of preparing for future needs.
The commercial sales and Xbox divisions were most affected by the layoffs. Amy Coleman, Microsoft's Chief People Officer, informed employees that the development of artificial intelligence is changing ways of working, which requires a reassessment of the company's priorities, investments, and resources.
Changes in the Xbox Division
In particular, the Xbox division felt a significant impact from these decisions. According to Ash Sharma, Xbox plans to eliminate around 3,200 positions by the 2027 fiscal year, with about 1,600 of them already cut. Furthermore, four Xbox studios will operate under new leadership.
The company's goal is to strengthen its gaming business and concentrate investments on projects that can yield greater profits in the future. In recent months, Microsoft has invested billions of dollars in AI infrastructure and is actively developing Copilot and other AI-based solutions, leading to a review of many old directions and teams.
Leadership Role and Strategy
Ash Sharma, a technically oriented leader of Indian descent who currently heads Xbox, noted that Xbox is going through a period of major change in its history. She acknowledged that making this decision was difficult but necessary for the long-term strengthening of the company.
Previously, Ash Sharma held senior roles at Microsoft related to AI, cloud technologies, and products. Now, under her leadership, Microsoft's gaming division is undergoing a significant transformation, drawing attention from the entire technology industry. It should be noted that this is not the first major wave of layoffs at Microsoft in recent years, but the company is focusing on increased investment in AI, new business models, and future technologies.
