Microsoft Cuts Jobs in Washington Amid AI Spending Surge

Microsoft has cut 3,160 jobs in Washington, bringing the total worldwide to over 15,000, as the company pours record sums into artificial intelligence. Despite spending $30 billion on AI infrastructure this quarter, CEO Satya Nadella acknowledges that job cuts can feel at odds with growth. The company's headcount has remained steady at around 228,000. Shares rose 2.2% on Monday.

Microsoft has announced a further round of job cuts, with 3,160 employees let go in Washington state. This brings the total number of worldwide layoffs to over 15,000 since the start of 2025, as the tech giant continues to prioritize investments in artificial intelligence (AI). Despite the significant job cuts, Microsoft's financial performance remains robust, with the company reporting strong revenue and profit growth, driven primarily by its cloud and AI businesses.

The latest round of layoffs comes as Microsoft is investing heavily in AI infrastructure. The company has allocated $30 billion for AI investments in the current quarter, with plans to spend an additional $30 billion by September 2025. This substantial investment underscores Microsoft's commitment to maintaining its leadership in the rapidly evolving technology landscape.

Microsoft's CEO, Satya Nadella, acknowledged the apparent contradiction between the job cuts and the company's growth. He stated, "While we continue to make tough decisions about our workforce, our focus remains on driving innovation and growth through AI and cloud technologies" [1]. Despite the layoffs, Microsoft's headcount has remained relatively steady at around 228,000 employees.

Investors responded positively to the news, with Microsoft's shares rising by 2.2% on Monday. The market appears to be supportive of the company's strategic direction, particularly its aggressive investment in AI and cloud computing.

Microsoft's financial performance in the latest quarter underscores the company's commitment to its AI-first strategy. Revenue from Azure, Microsoft's cloud computing platform, surpassed $75 billion, marking a significant increase of 34% year-over-year. The company's overall net income for the quarter was $27.2 billion, a 24% increase from the previous year.

While the job cuts have sparked frustration among workers, Microsoft's financial results demonstrate the company's ability to balance strategic investments with operational efficiency. The company's focus on AI and cloud technology is likely to continue, with the potential for further growth in these critical areas.

References:
[1] https://www.news18.com/business/microsoft-layoffs-2025-tech-giant-now-cuts-40-more-jobs-amid-record-ai-spend-ws-dl-9486392.html
[2] https://www.theverge.com/news/716552/satya-nadella-ai-investment-80-billion
[3] https://economictimes.indiatimes.com/news/international/us/microsoft-layoffs-in-2025-and-satya-nadellas-ai-strategy-microsoft-lays-off-thousands-makes-27-billion-profit-in-q2-ceo-satya-nadella-doubles-down-on-ai-mania/articleshow/123045962.cms