Microsoft announced a new round of job cuts internally on July 10 after laying off 10,000 employees between January and March.
The company confirmed the layoffs to GeekWire, which broke the news first but did not provide any further details.
“Organizational and workforce adjustments are a necessary and regular part of managing our business. We will continue to prioritize and invest in strategic growth areas for our future and in support of our customers and partners,” a Microsoft spokesperson said in a statement.
A number of LinkedIn posts indicated that the new layoffs will primarily target employees in customer service, support, and sales.
A Monday filing with the Washington state Worker Adjustment and Retraining Notification (WARN) system shows 276 layoffs across the company’s headquarters in Redmond and its Bellevue location, which are both in Washington.
The total number of new layoffs across all of Microsoft’s locations remains unknown.
A the end of its fiscal year on June 30, Microsoft said it had 221,000 employees globally, including 122,000 in the United States.
While it’s not uncommon for the company to restructure parts of its operations as it begins a new fiscal year, the continuing trend of layoffs within the tech industry is leaving many observers worried—and puzzled.
When Microsoft decided to cut 10,000 jobs in January, it had just reported a 12 percent increase in revenue for 2022’s final quarter—and $16.7 billion in profits. In April the company reported a 9 percent increase in profit for its first quarter of 2023, coming in at $18.3 billion.
Tech Industry Shedding Jobs
A similar trend can be observed with other big tech players.
After a pandemic-driven hiring spree, Google’s parent company Alphabet axed 12,000 jobs in January—despite reporting a net profit of $13.6 billion for Q4 of last year. For this year’s first quarter, it reported a net income of $16.4 billion.
E-commerce giant Amazon saw a sales increase of 9 percent in 2022’s final quarter compared to the previous year, before deciding to slash 18,000 jobs in January. This year’s first quarter saw another 9 percent increase in sales, amounting to a net income of $3.2 billion.
“40,000 people have been let go by 3 companies that made over $32 billion in profits in 3 months,” data and AI strategist Vin Vashishta commented on LinkedIn.
“At an average annual savings of $300,000 per employee, the layoffs will improve those quarterly profits (without one-time costs): Microsoft by 5 percent, Google by 6.4 percent, Amazon 48.2 percent,” he added.
Microsoft in January allowed its U.S. employees unlimited paid time off (PTO) as well as 10 corporate holidays and days off for illness, mental health, jury duty, etc.