Microsoft has commenced a series of job cuts focusing on underperforming employees across various departments, including its critical security division. A company spokesperson confirmed the layoffs with Business Insider but did not disclose the number of affected employees.
“At Microsoft, we focus on high-performance talent,” the spokesperson stated. “We are always working on helping people learn and grow. When people are not performing, we take the appropriate action.”
These performance-based reductions are part of Microsoft’s broader strategy to enhance efficiency and align its workforce with evolving business priorities. Notably, the layoffs impact teams in security, sales, and gaming sectors. Despite these cuts, the company often backfills roles vacated due to performance issues, suggesting that the overall headcount may remain relatively stable.
In January, Microsoft initiated performance-based job cuts, as evidenced by termination letters reviewed by Business Insider. These letters indicated that affected employees would not receive severance packages, and their benefits, including medical insurance, would cease immediately.
The technology sector has seen a wave of layoffs, with companies like Meta also targeting low performers in their workforce reductions. Experts caution that being labeled as an underperformer can have lasting impacts on an individual’s career prospects, as future employers may view such designations unfavorably.
Microsoft’s approach to managing underperformance isn’t new. In previous years, the company has encouraged managers to embrace “good attrition,” using layoffs as a mechanism to expedite the departure of underperforming staff.
These recent layoffs come at a time when Microsoft is investing heavily in artificial intelligence and cloud infrastructure. In April 2024, the company announced a $1.5 billion investment in Emirati AI firm G42, acquiring a minority stake to bolster its AI capabilities.
As Microsoft continues to navigate the evolving tech landscape, it remains to be seen how these workforce adjustments will impact its operational efficiency and innovation trajectory.