Last updated: January 19, 2023, 9:32 AM IST
Microsoft Chairman and CEO Satya Nadella said Wednesday that the company will “make changes that will result in a reduction of our total workforce by 10,000 jobs through the end of FY23 Q3 (Q3).”
Microsoft currently has more than 220,000 employees and this round of layoffs affects about 5 percent of the workforce.
Some workers will be notified Wednesday, but the full 10,000 layoffs should be completed by the end of March, Nadella said.
In a blog post, Nadella said it’s important to note that “while we’re cutting positions in some areas, we’re continuing to hire people in key strategic areas.”
“We know this is a challenging time for every person affected. The senior leadership team and I are committed to doing this process in the most thoughtful and transparent manner as we go through this process,” said Microsoft’s CEO.
The company had laid off about 1,000 employees by the end of last year.
Nadella said organizations in every industry and region are cautious as some parts of the world are in recession and others are anticipating recession.
“We will align our cost structure with our revenues and where we see customer demand,” he said.
He said Microsoft is “charging $1.2 billion in the second quarter related to termination fees, changes to our hardware portfolio and rental consolidation costs as we create higher density in our workspaces.”
“We will treat our people with dignity and respect and act transparently. These decisions are difficult, but necessary. They are especially difficult because they affect people and people’s lives – our colleagues and friends,” said Microsoft’s Indian-born CEO.
“Eligible U.S. employees will receive a variety of benefits, including above-market termination benefits, six months of continued health insurance, rolling stock awards for six months, career transition services, and 60 days’ notice prior to termination. regardless of whether such notice is required by law,” he announced.
Benefits for employees outside the US will be in accordance with labor laws in each country.
Microsoft will report its second quarter fiscal 2023 results on January 25.
The tech giant joins Amazon and Meta in massive tech layoffs amid its deepening funding winter amid global uncertainties.
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(This story has not been edited by News18 staff and was published from a syndicated news agency feed)