Microsoft is reportedly preparing another round of workforce reductions, with the company expected to cut fewer than 2.5% of its global employees, according to a Reuters report citing Business Insider. The layoffs could be announced as early as next week and are expected to impact thousands of workers across multiple departments, including sales, consulting, and the Xbox gaming division. While Reuters was unable to independently verify the report, the move is said to be part of Microsoft’s ongoing organizational restructuring.
Microsoft could cut thousands more jobs
Microsoft is reportedly preparing another round of layoffs that could affect thousands of employees across its global workforce. As of June 30, the company employed around 228,000 full-time workers, meaning a workforce reduction of less than 2.5% would still result in significant job losses. While the exact number has not been disclosed, reports suggest multiple business units will be impacted.
Xbox division may also face restructuring
The company’s Xbox gaming business is expected to be among the divisions affected by the reported layoffs. Earlier reports indicated Microsoft was planning substantial job cuts within Xbox alongside reductions in marketing and operational budgets. The gaming business has also been the subject of restructuring discussions, with reports suggesting Microsoft has explored options ranging from making Xbox a standalone subsidiary to a potential spinoff, although the company has not confirmed these plans.
Latest cuts follow previous workforce reductions
If announced, the new layoffs would come after Microsoft’s major workforce reduction in July 2025, when it eliminated nearly 4% of its global staff as part of a broader organisational restructuring. Over the past few years, the company has repeatedly adjusted its workforce while continuing to prioritise investments in strategic growth areas, particularly artificial intelligence and cloud technologies.
Tech companies continue to balance costs with AI spending
Microsoft’s reported move reflects a broader trend across the technology industry, where companies are trimming headcount while increasing investments in AI. Earlier this year, Meta announced plans to reduce around 10% of its workforce, while Amazon also disclosed plans to eliminate approximately 16,000 jobs globally. According to Reuters, technology, media, and finance companies in the US have continued to reduce staffing levels as they manage costs and redirect resources toward expanding AI infrastructure.
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