Microsoft has laid off a small amount of its staff as the fiscal year begins.

Companies often reveal structural changes at the start of the year, and Microsoft has moved to reduce staff numbers.

The number hasn’t been revealed, but the layoffs touch a range of groups and affect fewer than 1 percent of the company’s 181,000 employees as of June 2021.

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In recent months, technology businesses of all sizes have halted recruiting plans or announced personnel reductions in order to prepare for a probable economic downturn, which central bankers have been attempting to avert by rising interest rates.

This move has made investors less interested in growth-oriented businesses like Microsoft, whose shares have been down around 22 percent since the beginning of the year, while the larger S&P 500 index has fallen 19 percent.

A company spokesperson said: “Today we notified a small number of employees that their roles have been eliminated.”

“This was a result of a strategic realignment, and, like all companies, we evaluate our business on a regular basis. We continue to invest in certain areas and grow headcount in the year ahead.” 

Rajesh Jha, the Microsoft executive in charge of Office productivity software, instructed his team in May to acquire authorization before filling new positions.

Microsoft cut its income and sales projections in June, stating unfavorable foreign exchange rates.

On Monday, July 11, Gartner, a technology industry research firm, indicated that PC sales, a factor impacting Microsoft’s Windows operating system business, decreased roughly 13 percent in the third quarter, the slowest performance in nine years, partly due to geopolitical challenges.

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Microsoft last announced layoffs in 2017, just after the start of its new fiscal year. Thousands of people were laid off when the corporation changed its sales strategy.

This year, Facebook parent Meta Platforms reduced its plan for hiring software developers from 10,000 to roughly 6,000 to 7,000. Amazon’s retail segment has also reduced its recruiting target for 2022.

Source: CNBC

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