Microsoft Layoffs 2025: Tech Giant Cuts Nearly 9,000 Employees in Second Wave of Job Cuts
“We’re Reshaping for a Dynamic Market,” Says Microsoft Amid Fresh Layoffs Affecting Xbox, Sales Teams Globally
Microsoft has confirmed another round of massive layoffs, letting go of nearly 9,000 employees worldwide in its latest restructuring effort. This marks the tech giant’s second mass layoff in 2025, underscoring the turbulence sweeping across the technology sector.
The company, which has been aggressively pivoting towards artificial intelligence (AI) and cloud services, said on Wednesday (July 2, 2025) that the cuts would impact multiple teams, including its sales division and the popular Xbox video game business.
“We continue to implement organizational changes necessary to best position the company and teams for success in a dynamic marketplace,” Microsoft said in a statement.
Nearly 4% of Workforce Slashed
As of June 2024, Microsoft employed about 228,000 full-time workers globally. This latest layoff accounts for almost 4% of that workforce, equivalent to around 9,000 employees.
This comes on the heels of earlier job cuts:
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In May 2025, Microsoft laid off about 6,000 workers, its largest downsizing in over two years.
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In June, another 300 jobs were cut at its Redmond, Washington headquarters.
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Earlier in the year, about 2,000 employees in the Puget Sound region also lost their jobs.
These moves highlight Microsoft’s determination to streamline operations as it ramps up investments in AI and next-generation technologies.
Xbox and Sales Teams Among Hardest Hit
The layoffs reportedly affect employees across multiple global locations and departments. Notably, the Xbox gaming unit—a key part of Microsoft’s consumer business—is seeing significant restructuring.
Sales teams, which have traditionally been central to Microsoft’s enterprise partnerships, are also experiencing major reductions as the company shifts more toward AI-powered automation in its sales and support strategies.
Microsoft’s AI Push Behind the Restructuring
Industry analysts link Microsoft’s workforce changes to its multi-billion-dollar investments in AI, including its partnership with OpenAI and the integration of AI capabilities into its Office suite and Azure cloud platform.
“This is about positioning for the next wave of computing. But it comes at the cost of thousands of workers,” says Daniel Ives, an analyst at Wedbush Securities.
What’s Next for Microsoft Employees?
While Microsoft has not provided details on severance packages for those affected, earlier layoffs included generous exit benefits such as extended healthcare and job placement support.
The company said it remains committed to supporting impacted employees as they transition to new opportunities.
The Bigger Picture: Tech Industry Layoffs Continue
Microsoft’s cuts are part of a larger trend of job reductions across the tech sector in 2025, with companies like Google, Meta, and Amazon also downsizing amid economic uncertainty and a shift to AI-first strategies.
Disclaimer
This article is for informational purposes only and does not constitute financial or employment advice. For official updates on Microsoft’s restructuring and employee assistance programs, visit Microsoft’s official newsroom.
