{"id":272495,"date":"2025-07-18T16:37:12","date_gmt":"2025-07-18T16:37:12","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/272495\/"},"modified":"2025-07-18T16:37:12","modified_gmt":"2025-07-18T16:37:12","slug":"microsofts-constant-layoffs-risk-creating-a-culture-of-fear","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/272495\/","title":{"rendered":"Microsoft\u2019s constant layoffs risk creating a culture of fear"},"content":{"rendered":"

I can\u2019t open LinkedIn without seeing a new post from a Microsoft employee who lost their job in the company\u2019s latest round of layoffs. Around 15,000 jobs have been eliminated at Microsoft over the past couple months \u2014 the biggest cuts at the company in more than a decade<\/a>.<\/p>\n

I\u2019ve spoken to more than a dozen Microsoft employees in recent weeks, and everyone is concerned about the company\u2019s direction in this AI era. Morale is at an all-time low, and employees are worried that regular layoffs are simply the new normal.<\/p>\n

Sources tell me that Microsoft\u2019s leadership team had the choice between reducing investment in AI infrastructure for the upcoming financial year or deeply cutting its headcount and operating expenses. It\u2019s very clear what route Microsoft chose.<\/p>\n

These layoffs have been both broad and brutal. While you\u2019ve likely read the headlines about the impact on Xbox games studios, Microsoft\u2019s other cuts go far deeper and are part of a bigger plan to restructure Microsoft around AI tools.<\/p>\n

Microsoft has laid off technical specialists<\/a>, business strategy experts<\/a>, and product managers<\/a>. The sales side of Microsoft, which is responsible for businesses adopting its latest technology, has been hit particularly hard. Even AI<\/a> and cloud sales<\/a> teams have seen cuts, and account managers<\/a> across a variety<\/a> of Microsoft products have lost their jobs, too.<\/p>\n

Microsoft\u2019s layoffs have also impacted roles internationally, where an AI operations manager<\/a> in Portugal proved susceptible to Microsoft\u2019s latest reductions. Some employees even discovered<\/a> they had lost their job while on vacation<\/a>, and one was laid off twice<\/a> in around six months.<\/p>\n

This doesn\u2019t mean MS is necessarily reducing headcount overall, as employees like Patrick Lyons <\/strong>are being forced to apply for other roles. That could mean Microsoft\u2019s headcount might actually be similar this year to 2024.<\/p>\n

Experienced veteran employees were also cut recently. Former engineering manager HongQiao Li<\/strong> had spent nearly 21 years<\/a> at Microsoft prototyping the early version of Copilot in Office, before the latest cuts. Trinh Tran<\/strong>, a senior partner technology strategist, had dedicated 23 years<\/a> to Microsoft while building solutions for the company\u2019s cloud business and championing accessibility. Business strategy expert Darron Inman<\/strong> joined Microsoft in 1996 and is<\/a> \u201cdisappointed that I didn\u2019t quite make it to the 30-year mark.\u201d<\/p>\n

Microsoft\u2019s gaming business has been heavily impacted by the latest cull. Rare\u2019s Everwild and The Initiative\u2019s Perfect Dark games have been canceled<\/a>, with The Initiative shutting down as a result. Blackbird, a new game from ZeniMax Online Studios, impressed Microsoft Gaming CEO Phil Spencer<\/strong> earlier this year, but it was canceled anyway<\/a>. Blizzard is also sunsetting its Warcraft mobile game<\/a>, just months after Activision wound down<\/a> its Call of Duty: Warzone mobile game.<\/p>\n

Forza Motorsport developer Turn 10 Studios was also hit hard by Microsoft\u2019s cuts. One source described the layoffs<\/a> as leaving enough people behind to keep the game up and running. It looks like Turn 10 will simply be a support studio for the Forza franchise, so I doubt we\u2019ll see another Motorsport entry from the team.<\/p>\n

Raven, Sledgehammer Games, Rare, ZeniMax Online Studios, Halo Studios, and King have all been impacted by the Xbox cuts. King, which is behind Candy Crush, is preparing to cut as many as 200 staff, with the London-based Farm Heroes Saga team already being cut in half. Laid off King staff are reportedly being replaced by the AI tools<\/a> they helped build.<\/p>\n

At Irish developer Romero Games, 100 jobs are also at risk after Microsoft pulled funding for a project they were working on. Microsoft reportedly had a meeting<\/a> with Romero the day before the financing dried up, without any mention of the decision. Romero is now looking for another publishing partner for its game to avoid the studio\u2019s closure.<\/p>\n

Rare\u2019s Gregg Mayles, <\/strong>a 35-year veteran, is leaving<\/a> Microsoft following the Everwild cancellation, alongside Louise O\u2019Connor<\/strong>, executive producer of Everwild. ZeniMax president Matt Firor<\/strong> is departing<\/a> after 18 years leading the studio.<\/p>\n

Microsoft has also cut its Xbox user research team in half. It\u2019s a key team that focuses on ensuring quality across Xbox games, the platform, and developer tools. Without user research teams, Microsoft could have more games shipping in a poor state like Redfall<\/a>. The Xbox cuts have impacted community managers<\/a>, designers<\/a>, and branding experts<\/a>, too.<\/p>\n

While Microsoft didn\u2019t \u201cfeel the burn\u201d by launching a fiery Xbox controller<\/a> in parallel with gaming layoffs this year, it still had some tone-deaf mishaps this time around.<\/p>\n

Xbox executive producer Matt Turnbull<\/strong> recommended<\/a> that laid off employees seek advice from AI chatbots to \u201chelp reduce the emotional and cognitive load that comes with job loss.\u201d The ID@Xbox team sent out an email<\/a> blast about an AI roundtable at Gamescom as creatives rightfully worry about being replaced by AI.<\/p>\n

\u201cUsing AI is no longer optional\u201d inside some parts of Microsoft, as Julia Liuson<\/strong>, president of Microsoft\u2019s developer division, proclaimed in an internal memo recently. Microsoft is reportedly now asking some managers<\/a> to evaluate employees based on how much they use AI tools. Judson Althoff, Microsoft\u2019s chief commercial officer, even boasted \u2014 in the same week that Microsoft slashed jobs \u2014 about the company saving more than $500 million<\/a> last year in just its call centers thanks to AI.<\/p>\n

To top off the mishaps, principal developer lead Mike Matsel <\/strong>posted a sloppy<\/a>, AI-generated \u201cXbox Graphics is hiring\u201d image on LinkedIn, with a monitor\u2019s display on the wrong side. Microsoft has been regularly posting AI slop<\/a> to its corporate blogs for more than a year now, without a care in the world about how bad the images look, so it\u2019s not surprising to see more employees following along.<\/p>\n

This AI slop is generated by the same tools that Microsoft is trying to convince businesses to use. The company is still struggling to sell its $30 per user, per month Copilot subscription<\/a>, and the layoffs that have impacted Microsoft\u2019s sales teams are part of a broader restructuring effort to bring in more technical salespeople to better demonstrate AI tools to businesses. To that end, Microsoft is reportedly replacing<\/a> traditional salespeople with \u201csolutions engineers.\u201d<\/p>\n

Microsoft is competing with Google, Anthropic, Amazon, and even its AI partner OpenAI for a slice of the enterprise AI pie. If you mix that with AI infrastructure costs, you get the type of constant mass layoffs we\u2019ve seen at Microsoft over the past 18 months.<\/p>\n

The atmosphere inside Microsoft is now very different from just a decade ago, when Microsoft was considered cool again<\/a> and Satya Nadella<\/strong> had just been promoted to CEO<\/a> and overhauled the company\u2019s culture to embrace a world beyond Windows<\/a>. That culture change saw Microsoft make some huge acquisitions like LinkedIn<\/a> and GitHub<\/a>, and saw it really capitalize on the shift to cloud computing. Now, Microsoft risks creating a culture of fear as it pushes employees to adapt<\/a> to the promises of AI, where surprise \u201cperformance-related\u201d job cuts can happen at any time, all because it\u2019s in an uncertain AI race that\u2019s costing tens of billions of dollars.<\/p>\n