Microsoft is planning to eliminate tens of thousands of jobs, the latest step by one of the world’s largest technology businesses to shrink its workforce in response to a slowing global economy.
Sky News has learned that the US software giant may disclose intentions to eliminate a considerable number of global positions within days.
Microsoft, which employs more than 220,000 people, including 6,000 in the United Kingdom, is rumored to be considering a 5% staff reduction, which, if accurate, would result in the elimination of nearly 11,000 positions.
This amount could not be confirmed as of Tuesday evening, and one analyst speculated that Wall Street would be astonished if it were not higher. It was also unknown whether or how many positions situated in the United Kingdom would be affected.
The corporation, which has a current market capitalization of $1.78tn and has made significant bets on the expansion of cloud computing, will announce second-quarter earnings the following week.
If finalized, a staff reduction announcement is anticipated to be made before Satya Nadella, Microsoft’s chairman and chief executive officer informs investors of the company’s financial performance on January 24.
Big Tech Companies Slash Jobs
In recent weeks, a number of prominent internet businesses have laid off employees, with Amazon announcing this month that it will eliminate 18,000 jobs or around 6% of its staff.
Salesforce, a producer of cloud-based software, announced that it will eliminate 8,000 positions, while Meta, the owner of Facebook, will reduce its personnel by around 11,000.
Many large technology corporations recruited tens of thousands of new personnel during the epidemic in response to warnings of a global economic slowdown. Under Elon Musk’s ownership, Twitter has eliminated thousands of jobs, while the personal computer manufacturer HP has eliminated 6,000.
Microsoft warned in October of a downturn in its cloud computing business, recognizing that key corporate clients were reevaluating expenditure in reaction to economic difficulties.
Under Nadella’s leadership, the company has been revolutionized, but its recent earnings have been hurt by the strength of the dollar. Microsoft anticipates generating $5 billion in revenue during the duration of the collaboration.
Guggenheim analysts lowered Microsoft’s shares to a sell recommendation ahead of the company’s earnings report next week, arguing that the numbers may disappoint investors.