Layoffs were announced by Microsoft at its Azure cloud unit, impacting teams like Azure for Operators and Mission Engineering, as per reports. The job cuts come as Microsoft tries to maintain its profit margins amid heavier capital spending, which is designed to provide the cloud infrastructure needed to train and deploy the models that power AI applications.
As report on Monday, Microsoft is on a job cut spree affecting hundreds of employees at its Azure cloud unit, adding to a flurry of layoffs seen in the technology and media industries this year.
Microsoft’s Azure layoffs
The layoffs will impact teams including Azure for Operators and Mission Engineering, according to the report. The Azure for Operators layoffs involve as many as 1,500 job cuts, it added, citing people familiar with the situation.
“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,” as per a Microsoft spokesperson.
Previous job cuts
The cuts come after the company shed 1,900 jobs at Activision Blizzard and Xbox in January this year. Tech firms including Amazon.com and Salesforce also laid off several hundred employees in 2024.
Microsoft’s cost control
Microsoft’s Azure cloud is witnessing sharp growth due to the company’s heavy investment in AI and its access to the coveted technologies of ChatGPT maker OpenAI through their strategic partnership.
Separately, Microsoft has started restructuring its mixed reality organization but will continue to sell its augmented reality headset, the HoloLens 2, as per a spokesperson on Monday.
The Azure for Operators and Mission Engineering teams are part of an organization created to house Microsoft moonshots. This broader org was created in 2021 and is called Strategic Missions and Technologies (SMT). It’s led by former Azure boss Jason Zander and brings together cutting-edge initiatives such as quantum computing and space alongside its government cloud business.
More layoffs at Microsoft
Other than Azure layoffs, Microsoft will also cut jobs of employees working in its mixed reality department. The cuts will affect the department that contributes to the HoloLens 2 augmented reality headset. Though, Microsoft plans to continue selling the device. As per a report by Business Insider in 2022 that the company scrapped plans for HoloLens 3.
Microsoft’s stock update
Microsoft stock closed at $413.52 down 1.61 (0.39%) today.