Tech company Microsoft has revealed plans to cut 3% of its workforce as it seeks to streamline operations. These job cuts will affect employees of all levels, with a specific focus on reducing layers of management. Microsoft last reported 228,000 employees, meaning these layoffs would affect around 6,840 people.
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These also aren’t the first layoffs Microsoft announced this year. The company cut a smaller number of jobs in January, based on the performance of its workers. The latest job cuts aren’t based on performance, but are instead a wider reduction of roles at the tech company, aimed at eliminating unnecessary positions.
Investors didn’t appear to care much one way or another about the layoffs, as MSFT stock was down 0.23% on Tuesday, but is still up 6.55% year-to-date.
Microsoft Layoffs Add to Tech Job Cuts
Microsoft is far from the only tech company that has announced job cuts in 2025. IT company CrowdStrike (CRWD) announced job cuts last week that affected 5% of its workforce. Alphabet’s (GOOGL) Google also cut jobs over the last year to rein in spending.
The latest round of tech job cuts come as companies embrace artificial intelligence (AI). AI can handle the tasks previously assigned to humans for reduced costs. However, AI development is expensive and many companies have yet to show how it will be profitable. That has companies seeking ways to offset those costs, such as integrating AI in their workforces and reducing human labor.
Is MSFT Stock a Buy, Hold, or Sell?
Turning to Wall Street, the analysts’ consensus rating for Microsoft is Strong Buy, based on 30 Buy and five Hold ratings over the last three months. With that comes an average MSFT stock price target of $490.97, representing a potential 9.56% upside for the shares.
