(Bloomberg) – Microsoft Corp. plans to cut jobs in a number of tech divisions on Wednesday, according to a person familiar with the matter, joining the ranks of tech giants scaling back as the industry prepares for a protracted demand slump.
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The size of the cuts could not be ascertained, but the person, who requested not to be identified when discussing confidential matters, said the cut will be significantly larger than other rounds at Microsoft in the past year. Those cuts affected less than 1% of the software giant’s workforce of more than 200,000.
Microsoft recently reduced its workforce in October and July, eliminating open positions and pausing hiring in various groups. While tech peers like Amazon.com Inc., Meta Platforms Inc. and Salesforce Inc. Having announced cuts by the thousands in recent months, Redmond, Washington-based Microsoft has taken smaller steps so far to cope with a deteriorating global economic outlook and the potential for a prolonged slowdown in demand for software and services.
A Microsoft representative declined to comment. Shares, which are down 23% over the past year, were little changed at $240.35 at the New York close on Tuesday. Sky News previously reported that the company was planning to cut thousands of jobs, and Insider reported that Microsoft could cut its recruiting staff by as much as a third.
Microsoft is expected to post a 2% revenue increase in its fiscal second quarter when it reports earnings on Jan. 24. That would be the slowest revenue increase since fiscal 2017. Since then, Microsoft’s cloud computing business has fueled a resurgence in growth, but even that business began to slow over the past year.
Still, the company has waited longer than many other technology leaders to significantly reduce its workforce. Cloud rival Amazon is laying off more than 18,000 employees – the largest reduction in its history. Facebook parent Meta announced massive job cuts last fall and beleaguered social network Twitter Inc. has cut back about half of its workforce. Business cloud software maker Salesforce laid off about 10% of its employees earlier this month.
Read a running list of the tech companies planning layoffs
(Updates with the stock’s closing price in the fourth paragraph. An earlier version of this story corrected the fifth paragraph to indicate that the most recent period was fiscal second quarter, not fiscal third.)
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