Microsoft to Cut Under 2.5% of Workforce in New Layoffs

Microsoft is preparing a fresh round of job cuts that will affect fewer than 2.5% of its global workforce – roughly 5,500 to 5,700 employees out of about 228,000 staff. The layoffs are slated for July 2026 and are expected to target sales, consulting and the Xbox gaming division, where recent price hikes and a components shortage have heightened cost pressures.

The cuts come as the company redirects spending toward artificial‑intelligence infrastructure, protecting a $190 billion capital program while trimming payroll. Microsoft has already offered a voluntary retirement programme to senior U.S. employees, with about 9,000 eligible staff, and its shares have fallen roughly 20% year‑to‑date amid investor concerns over AI‑driven spending.

Previous reductions in 2025 saw 6,000 jobs cut in May and another 9,000 in July, a combined 4% of the workforce. Business‑insider reports and Reuters filings confirm the new round will be smaller than last year’s but still represent a “several‑thousand‑person” reduction. The company has not officially commented, and the exact timing of the announcement remains uncertain.