In a US regulatory filing, the manufacturer of the Windows operating system stated that the reductions were made “in response to macroeconomic conditions and changing customer priorities.”
The layoffs will affect slightly less than 5% of employees and come after similar moves by Meta, the owner of Facebook, Amazon, and Twitter, which announced thousands of layoffs in the tech industry that was once unstoppable.
During the coronavirus pandemic, businesses in the tech sector went on a hiring spree to meet the skyrocketing demand for their products as more people worked from home and used the internet for entertainment.
When questioned about the layoffs prior to the announcement, Microsoft CEO Satya Nadella stated that “no one can defy gravity” and cited high inflation as a factor affecting global economic expansion.
“During the pandemic, things moved quickly. At the World Economic Forum in Davos, he added, “I think we’re going to go through a phase today where there is going to be some amount of normalization of that demand.”
According to Microsoft’s filing with the US Securities and Exchange Commission, the reductions would cost $1.2 billion when they announced their next results on January 24.
In a letter to employees that was made public by the SEC, Nadella stated, “It’s important to note that while we are eliminating roles in some areas, we will continue to hire in key strategic areas.”