Microsoft Plans Thousands of Job Cuts Next Week Amid Tech Industry Restructuring

Microsoft is preparing to cut less than 2.5% of its workforce in an upcoming round of layoffs expected to be announced next week, according to Business Insider sources. This move follows a broader trend of major U.S. tech, media, and finance companies reducing headcount to control costs while shifting investments toward artificial intelligence infrastructure.

The layoffs will affect thousands of employees, particularly in sales, consulting, and the Xbox gaming division. Microsoft has not yet commented on the reports. As of June 30, 2025, Microsoft employed approximately 228,000 full-time workers, indicating the upcoming cuts will be significant. In July 2025, the company had already announced layoffs affecting nearly 4% of its workforce, one of its largest recent reductions.

The Xbox division is facing notable challenges, including recent global price hikes on consoles due to a worsening component shortage. It plans extensive layoffs and deep budget cuts in marketing and other areas. Additionally, Microsoft is actively considering structural changes to the gaming unit, including a possible spin-off or reorganization as a wholly owned subsidiary, according to a June report by The Information.

This upheaval at Microsoft is part of a wider shakeup in the global tech sector. Meta has announced plans to cut 10% of its workforce this year, and Amazon is set to eliminate around 16,000 jobs worldwide as part of its restructuring efforts.