Don't Buy the Excuses for Microsoft's Mass Layoffs
They're cheapening their workforce and other things
When a cofounder of Microsoft manages to rope in a 'cofounder' of GNU/Linux (for reputation laundering purposes) you know something is deeply problematic at Microsoft. Back in the 90s Microsoft was very dominant. Now, Android - which contains Linux - is the dominant operating system and Microsoft has had close to 10 waves of mass layoffs in the first ~6 months of 2025. Some people already talk about the next wave.
Even outside the US, where there's a holiday (Microsoft chose July 2 2025 for the same reason it did that a year ago), journalism about the layoffs has been lacking. They all parrot the same talking points and say nothing about which units at Microsoft were most deeply cut/affected, perhaps with the exception of games. So far we caught half a dozen headlines that try to blame "AI investment" (or something to that effect) for the layoffs. We saw that coming. As we keep saying (and also showing), the core issue is a lack of money or scarcity thereof. The workers - i.e. salaries - are considered expensive. A sort of Salesforce-owned site has just said that "Microsoft's H-1B Visa Applications [are] Questioned Amid Mass Layoffs" and it states: "In the weeks that followed those layoff announcements, claims began circulated on X that the company had also applied for upwards of 6,000 high-skilled work visas, or H-1Bs, since October, the start of the current fiscal year. While that number could not be independently confirmed, during the last fiscal year, Microsoft applied for 9,491 H-1B visas. All were approved."
To be clear, Salesforce, Amazon, Google etc. do similar things. They do control the media (e.g. Bezos with Washington Post), so they're not likely to scrutinise their own cost-saving moves. IBM does much of the same. The workers are livid about it.
We wrote about this yesterday. Whether you agree with the outsourcing/offshoring or not (or importing people who work harder for less), it is not a sign of a company doing well. They say that when a company stops giving you free coffee (like Intel did some years ago) or sells its coffee machine/s, it's time to brush up the CV and look for another job because such cost-saving moves are signs of desperation. As someone put it some hours ago, in relation to Microsoft: "Still surviving 20+ years later with too many promotions to count and many stock/RSU grants. Internal networking and politics are the best defense against any reduction in force. You think working 10–16-hour day and sacrificing your personal time will help you that much? Same with AI."
Many remaining Microsoft employees are stressed and overworked. They wrongly assume that working harder will save them, as if top-level decisions are made based on performance. It's not a decision for Line Managers to make.
Back in the 90s, Microsoft bought a lot of companies to get and stay ahead. It also hired "expensive" staff (i.e. staff that demanded high salaries). Nowadays Microsoft barely buys any company, it lays off people all the time, and its promise of an "hey hi revolution" is bust. █
"Microsoft, the world’s most valuable company, declared a profit of $4.5 billion in 1998; when the cost of options awarded that year, plus the change in the value of outstanding options, is deducted, the firm made a loss of $18 billion, according to Smithers."