Microsoft has told employees that its latest job cuts are not a one-off move, but part of a larger restructuring plan that will continue in the months ahead. In an internal note to staff, Executive Vice President and Chief People Officer Amy Coleman said the company is making changes to keep pace with shifts in technology, customer expectations and business priorities.
The latest round of layoffs will affect around 4,800 employees, which is nearly 2.1% of Microsoft’s global workforce. Coleman acknowledged that the decision would be difficult for teams across the company and thanked those leaving for their work.
“The people whose jobs are impacted today are our colleagues and friends. They have made meaningful contributions to Microsoft, and we are deeply grateful for everything they have done,” Coleman said.
Microsoft calls layoffs part of a broader transformation
Coleman said the restructuring reflects the speed at which the technology sector is changing. She noted that companies have little choice but to respond when customer needs, business models and workplace expectations change.
“Our business is changing because the world around it is changing. Companies don't get to choose whether their industry changes; they only get to choose whether they change with it. That means we will need to adjust resources and roles and shift how we operate so we can have the greatest impact for our customers,” she said.
She also responded to questions around artificial intelligence and whether AI was behind the layoffs. Coleman said the cuts are not directly linked to AI replacing employees. At the same time, she said AI is changing day-to-day work by taking over repetitive tasks, which means employees will need to keep building new skills and adapt to changing roles.
More changes expected at Microsoft
Coleman indicated that Microsoft is still in the early stages of this restructuring process and that more changes should be expected.
“We are still early on this journey, and there will be more changes ahead. Other parts of our business will need to make similar changes,” she said.
The current layoffs are expected to hit Microsoft’s Commercial and Xbox divisions. Earlier, Xbox CEO Asha Sharma confirmed that the company plans to cut around 3,200 jobs across the Xbox business during FY27 as part of the same restructuring push. Sharma also said the Xbox business is currently “not healthy,” suggesting that the company may take more steps to fix its operations.
