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Microsoft Braces For Recession With Layoffs

Microsoft Braces For Recession With Layoffs

Microsoft has reportedly laid off at least several hundred staff members as they brace for economic uncertainty and slowing demand. Although Microsoft is yet to confirm the exact number, it seems as many as 1000 employees may have been affected. This is just one of many large corporations to respond to inflation and the current recession with layoffs. 

Microsoft Braces For Recession With Layoffs

The company confirmed that the job cuts affected multiple geographic regions, levels, and departments. Some employees took to social media to share that their job had been cut.

In a statement to Axios, Microsoft said, “Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly. We will continue to invest in our business and hire in key growth areas in the year ahead.” 

The Verge senior editor, Tom Warren, reported on his Twitter that the job cuts affected teams in the Experiences and Devices, Xbox, and Legal divisions. Apparently, some of those released were long-standing Microsoft employees.


Microsoft Braces For Recession With Layoffs


The latest round of layoffs comes about three months after the tech giant announced that it cut the jobs of close to 1% of its more than 200,000 employees in July this year.

The first sign that Microsoft was looking to scale down its hiring and reduce expenses came in May this year when it was reported that the company would be slowing its hiring in their Windows, Office, and Teams chat and conferencing software groups.

Microsoft will likely not be the last big company to lay off employees this year. A recent report indicated that up to 15% of META employees, the parent company of Facebook, are at risk of losing their jobs. If so, about 12000 META employees would join the unemployed.

Other notable layoffs this year include Salesforce – Their first ever year of layoffs, Intel, and the social media giant, Twitter.

As PC sales continue to decline due to various factors like COVID-19 and the Ukraine-Russia conflict, it is possible that tech companies across the board will continue to face hardship. This has the potential to spell trouble for these companies in the market if investors start to worry about this recent slump.

Microsoft Braces For Recession With Layoffs

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How Will This Affect Microsoft Share Prices?

Microsoft (MSFT) shares are down just under 30% year to date, slightly less than the tech-heavy NASDAQ index. 

Microsoft’s most recent quarterly earnings in July failed to match investor expectations. The company reported $51.9 billion in revenue, missing the expected $52.4 billion. 

It remains to be seen if these layoffs will further affect the share price of this tech giant. Investors will need to wait until Microsoft reports its next quarterly earnings in the last week of October to get a better idea of where the stock is headed. 


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Jessica is a published author and copywriter specializing in personal and investment finance. Her expertise is in financial product reviews and stock market education.