Microsoft layoffs 2025: Tech giant to cut several thousands of underperforming employees this year

Microsoft has announced plans for another round of layoffs in 2025, targeting underperforming employees across various departments, including its security division. The move is part of the company’s updated performance management strategy, aligning with similar actions by other tech giants.

According to reports, the company has confirmed the decision but has not revealed the exact number of employees impacted. A spokesperson shared that Microsoft remains committed to fostering growth and learning among its workforce but takes necessary steps when employees fall short of performance expectations. Despite the layoffs, vacated roles are often refilled, suggesting Microsoft’s overall workforce, which stood at 228,000 full-time employees in June 2024, may not see a significant reduction.

Layoffs across divisions

The layoffs follow months of evaluations by managers, scrutinising employees at all levels, including senior positions. The cuts are expected to be widespread, impacting several departments, with the security division reportedly among those affected.

This is not Microsoft’s first instance of restructuring in recent years. In 2023, the company reduced its workforce by approximately 10,000 roles, equivalent to 5% of its global workforce. That same year, smaller layoffs hit the Xbox gaming division. The trend continued in 2024, following Microsoft’s acquisition of Activision Blizzard, which led to around 2,000 layoffs in its gaming division. Further reductions were later made in the Azure cloud computing business, where 1,000 roles were ultimately cut.

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A broader industry trend

Microsoft’s recent moves reflect a broader shift within the tech industry, as companies prioritise efficiency and performance. Layoffs and restructuring have become common as organisations reassess operations to align with evolving market conditions and technological advancements.

Focus on AI skilling in India

In a contrasting development, Microsoft has launched an ambitious initiative to train 500,000 individuals in rural India in artificial intelligence (AI) skills. Announced by Microsoft Chairman and CEO Satya Nadella during his visit to New Delhi, the programme is a collaboration with India’s Ministry of Electronics and Information Technology (MeitY).

This effort aims to empower underserved communities with AI expertise, supporting the country’s growing influence in the tech sector. Nadella highlighted India’s rapid progress in AI skilling and emphasised the importance of scaling human capabilities alongside advancing technology. The initiative forms part of the Microsoft AI Tour, which underscores the company’s commitment to fostering talent and innovation globally.

With layoffs reshaping its workforce and investments in AI skilling expanding its global reach, Microsoft continues to navigate the delicate balance between efficiency and growth.