Microsoft Confirms Layoffs, Restructuring

Posted on July 6, 2017 by Paul Thurrott in Cloud with 13 Comments

Microsoft Confirms Layoffs, Restructuring

Microsoft today announced that it will lay off several thousand employees, mostly from its sales force, and mostly outside of the United States.

“Microsoft is implementing changes to better serve our customers and partners,” a Microsoft statement explains. “Today, we are taking steps to notify some employees that their jobs are under consideration or that their positions will be eliminated. Like all companies, we evaluate our business on a regular basis. This can result in increased investment in some places and, from time-to-time, re-deployment in others.”

Microsoft has over 120,000 employees around the world—including about 50,000 outside the US—and these cuts will impact less than 10 percent of its sales force. The firm noted that the cuts were not being made to save money, but rather to better align the business with the realities of today’s market. As you know, Microsoft is reorganizing its broader corporate structure to capitalize on cloud computing. And this change is just a small step to that future.

I had previously heard that Microsoft would lay off up to 20 percent of its sales force. That source told me to expect another round of layoffs after the summer, as well.

Further, while most of the layoffs do impact sales, some do not. And Microsoft is using this action as an opportunity to cull other employees, including those that are close to retirement and will be offered an early leave. The good news? This shouldn’t have any major impact on Microsoft’s products and services, as when Microsoft restructured its phone business two years ago.

 

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