DAVOS, Switzerland ― Microsoft Corp said it would eliminate 10,000 jobs and take a $1.2-billion charge, as its cloud-computing customers reassess their spending and the company braces for potential recession.
The layoff, far larger than cuts by Microsoft last year, pile on to tens of thousands of job cuts across the technology sector that’s long past its strong growth during the pandemic.
Its shares fell about 1%. The news comes even as the software maker is set to ramp up spending in generative artificial intelligence that is the new bright spot for the industry.
Just this week, its chief executive touted AI to world leaders gathered in Davos, Switzerland, claiming the technology would transform its products and touch people around the globe.
Microsoft has looked at adding to its $1-billion stake in OpenAI, the startup behind the Silicon Valley chatbot sensation known as ChatGPT.
In a note to employees, CEO Satya Nadella attempted to address the divergent realities.
Customers wanted to “optimize their digital spend to do more with less” and “exercise caution as some parts of the world are in a recession and other parts are anticipating one,” he said according to Reuters.
“At the same time, the next major wave of computing is being born with advances in AI.”
Discussion about this post