Microsoft Corp. is preparing for another round of layoffs, primarily targeting sales roles.

The announcement is expected early next month, following the end of the company’s fiscal year.

Sources noted the cuts may extend beyond sales teams, and the timeline could still change.

Microsoft has not publicly commented.

This follows a May layoff round that affected 6,000 employees, mostly in product and engineering. Sales and marketing roles were largely spared at that time.

In April, Microsoft also said it would rely more on third-party firms for software sales to small and medium-sized businesses.

As the company invests heavily in AI infrastructure like servers and data centers, executives have committed to limiting spending in other areas.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Microsoft’s layoff cycles follow strategic pivot patterns

Microsoft’s workforce reductions consistently coincide with major strategic shifts, showing a pattern of resource reallocation during transitions.

The company’s largest previous layoffs came in 2014 when it cut 18,000 jobs (14% of its workforce) following the Nokia acquisition, as it pivoted toward mobile and cloud computing 1.

Similarly, the current cuts come as Microsoft invests heavily in AI infrastructure, with planned capital expenditure of $80 billion this fiscal year primarily for expanding AI-capable data centers 2.

This pattern suggests Microsoft systematically restructures its workforce when realigning resources toward new strategic priorities, with these cuts representing the company’s adaptation to the AI era.

The company’s stock rose 3% following the 2014 layoff announcements, indicating that investors typically view these restructurings as necessary for long-term competitiveness rather than signs of financial trouble 1.

2️⃣ Tech industry shifting from growth-at-all-costs to efficiency model

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