Microsoft’s CEO, Satya Nadella, has rationalized the recent job cuts at the company despite its impressive profits, record stock prices, and heavy investments in artificial intelligence (AI). In his memo to staff, he acknowledged the worries surrounding layoffs and stated, “Before anything else, I want to speak to what’s been weighing heavily on me and what I know many of you are thinking about: the recent job eliminations.”
This year, Microsoft has let go of over 15,000 employees, including around 2,000 deemed underperformers, all amid strong financial performance, with net income at about $75 billion across the last three fiscal quarters. The company has also invested $80 billion in AI infrastructure, and on July 9, shares reached a record high above $500. Nadella clarified that the layoffs, despite Microsoft’s overall prosperity in market performance and strategic advancements, are the result of the complexities of success in a rapidly changing industry.
He emphasized the importance of both “unlearning” and “learning” as the organization adapts to new challenges and technologies. While Nadella reassured staff about the company’s mission, many former employees have voiced their great disappointment about the layoffs and Nadella’s thoughtless statements and actions, also expressing how much they appreciated their roles at Microsoft. Currently, the company stands as the second most valuable publicly traded entity globally, just behind Nvidia, with its Windows and Office products dominating the market while the Azure cloud segment continues to expand.
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