In a surprising turn of events, Microsoft has announced a fresh wave of layoffs, affecting primarily its sales, marketing, and customer support departments. This comes just months after CEO Satya Nadella had previously declared a reduction of 10,000 employees, which was anticipated to be completed by the end of March. The news of these additional job cuts was revealed as several employees updated their LinkedIn profiles to reflect their status as part of the new round of layoffs.
A lot of tech companies seem to be benefitting from AI going mainstream
A spokesperson from Microsoft confirmed the recent workforce adjustments, stating, “Organizational and workforce adjustments are a necessary and routine part of managing our business. We will continue to prioritize investments in strategic growth areas to support the future of our customers and partners.” While the statement may provide some insight into the motivation behind the layoffs, it remains unclear why these specific departments have been targeted.
Despite these layoffs, Microsoft’s financial position remains robust in 2023. Over the past six months, the company’s shares have surged by an impressive 40.74%. This upward trajectory can be attributed, at least in part, to Microsoft’s investment in the generative AI business. The company has recognized the potential of artificial intelligence, and its strategic decisions in this area have paid off handsomely.
Microsoft is not the only company benefiting from the AI revolution. Stock prices of other technology companies have experienced significant increases due to the impact of artificial intelligence. For example, Nvidia has seen its stock price soar by an astounding 194.61% in 2023, reaching record highs.
As Microsoft’s fiscal year approaches its end on March 31, 2023, the company’s net profit has risen to an impressive $18.3 billion, representing a 9% year-on-year increase. Investors eagerly await the announcement of Microsoft’s fourth-quarter earnings, which is scheduled for the end of this month.
While the news of the latest round of layoffs may unsettle some, Microsoft claims that it’s all to increase strategic focus on growth areas. Coupled with its strong financial performance, the company is clearly stating its commitment to staying ahead in the game.
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