Yesterday, we heard about the death of an engineer at tech giant Microsoft (MSFT), as Pratik Pandey was found dead on the Microsoft campus. As it turns out, that may not be the only form of worker attrition Microsoft is poised to see, as plans emerged for a slug of layoffs to hit in its operations in France. The news buoyed shares a bit, as they rose fractionally in Thursday afternoon’s trading.
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The reports suggest that a total decimation is on the way, as Microsoft cuts 10% of its workforce in France. Given that Microsoft only employs about 2,000 people in France, that means 200 people are on the block. Most of the Microsoft employees in France are located just southwest of Paris, at the offices in Issy-les-Moulineaux.
This is actually part of a wave of layoffs we heard about previously, in which Microsoft looked to get rid of 9,000 employees all told. That wave was first announced back in July. Early reports suggest that the effects on morale at Microsoft could be substantial, especially in the wake of the Pratik Pandey death.
The Console Wars May Truly Be Over
This is the part where things get interesting for Microsoft’s gaming operations, as we recently discovered that competitor Sony (SONY) is actually a bigger part of Microsoft’s gaming sales than Microsoft itself is. Currently, Helldivers 2 is the number one paid game on the Xbox Series X/S. That by itself would be a meaningful note, but it gets better: Sony actually has more best-selling games on the top 25 list than Microsoft itself does.
Having tried Helldivers 2 recently myself, it does have an exciting presence of the kind Microsoft has not brought out much. There is a value in novelty, and Sony’s game-making style is different from Microsoft’s. With word still around that the next Xbox could come with Steam support, and eliminate a lot of the distinction between console and PC gaming—though not all of it—the end result could be a wildly different gaming landscape when the next versions of consoles come out.
Is Microsoft a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MSFT stock based on 34 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 23.74% rally in its share price over the past year, the average MSFT price target of $625.98 per share implies 23.54% upside potential.
