Microsoft to cut thousands of jobs in latest cull by technology giant | Business news

Microsoft is preparing to cut thousands of jobs in the latest move by one of the world’s largest tech companies to reduce its workforce in the face of a slowing global economy.

Sky News has learned that the US software giant could announce plans to remove a significant number of posts around the world within days.

Microsoftwhich employs more than 220,000 people, including 6,000 in the UK, is reportedly considering cutting around 5% of its workforce, which if accurate would equate to around 11,000 jobs.

That figure could not be verified Tuesday night, and one analyst suggested Wall Street would be surprised if the figure wasn’t higher.

It was also unclear if and how many UK-based positions could be affected.

The company, which has invested heavily in the growth of cloud computing and now has a market value of $1.78 trillion, will report its second-quarter results next week.

If finalized, there will likely be an announcement about staff cuts before Satya Nadella, Microsoft’s chairman and CEO, will update investors on his financial performance on Jan. 24.

In recent weeks, a slew of big tech companies have taken the axe, with Amazon this month announcing plans to cut 18,000 jobs, or about 6% of its workforce.

Salesforce, the cloud software provider, said it would cut 8,000 jobs, while Meta, the owner of Facebook, would cut its workforce by about 11,000 jobs.

Major tech companies have been forced to respond to signs of a global economic slowdown, with many hiring tens of thousands of additional workers during the pandemic.

Satya Nadella

Under Elon Musk’s ownership, Twitter has also taken steps to cut thousands of jobs, while also losing 6,000 at PC maker HP.

Microsoft in October warned of a slowdown in its cloud computing business, acknowledging that large enterprise customers were reassessing their spending in response to economic challenges.

“In a world facing increasing headwinds, digital technology is the ultimate tailwind,” Nadella said in October.

“In this environment, we are focused on helping our clients do more with less, while investing in secular growth areas and managing our cost structure in a disciplined manner.”

The company has been transformed under Mr. Nadella’s leadership, although revenues have been hampered by the strong dollar in recent quarters.

It is also battling with regulators to get approval for a £56bn acquisition of Activision Blizzard, the maker of Call Of Duty.

Last month it surprised investors by acquiring a £1.5 billion stake in the owner of the London Stock Exchange as part of a long-term cloud computing partnership.

Microsoft expects to generate $5 billion in revenue over the life of the alliance.

Ahead of earnings next week, Microsoft’s stock was downgraded to a sell rating by Guggenheim analysts, who said the numbers “could disappoint investors.”

“While most investors see Microsoft as a big stable company that can weather any storm, it has vulnerabilities, some of which could be exacerbated by this macro.”[economic] delay,” they wrote.

In response to a question from Sky News, a spokesperson said Microsoft “does not comment on rumors or speculation”.