Microsoft's announcement of potential layoffs, as well as large layoffs in the technology sector, was the main cause of concern in the industry. Among the predictions, the company was thought to announce literally 22,000 job reductions by the end of January, thus creating a wave of uncertainty among workers and the whole industry. Then again, Microsoft quickly denied the situation entirely and characterized the information as wrong.
Origin of the Layoff Rumors
- The rumors stemmed from a story by TipRanks which a research and analysis company. This publication declared that Microsoft would lay off from 11,000 to 22,000 employees. The rumors also mentioned that the laid-off workers would be from the Azure Cloud Services, Xbox, and Global Sales Operations teams.
- The article pointed at the high operational costs and the impact of the company's heavy investment in AI as reasons behind the possible layoffs. Before the publication of the report, it went viral with the help of social media networks.
Microsoft’s Response
Microsoft went through its Chief Communications Officer, Frank X. Shaw, to debunk the rumors. In his post on social media, he unequivocally described the rumors as “100% baseless” and said that the reports concerning cutback of staff were false. Prior to this, Jez Corden, editor of Windows Central, had also opined that the rumor regarding layoffs was untrue.However, the company has not yet released a statement to make it official that they are refuting the reports.
Context from Previous Layoffs
- Microsoft did not shy away from significant layoffs in July of the last year. At that time, the management gave notice to about 9,000 employees, clarifying that the moves were necessary and part of their long-term business strategy.
- During that period, Microsoft also canceled several game projects and shut down some studios. By July last year, the company’s market value had reached approximately $4 trillion.
Current Status
At present, Microsoft has denied reports of a new round of mass layoffs. The company has confirmed that the claims circulating online do not reflect current plans. Employees and the public are advised to rely on official company communication for accurate information.
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