Microsoft has announced a global reduction of approximately 4800 roles, representing 2.1 per cent of its workforce, impacting its six Australian offices that employ more than 3000 people. The layoffs were disclosed by Chief People Officer Amy Coleman, who stated the changes are intended to position the company for a fast-changing industry with a greater focus on artificial intelligence.
Impact on Australian Offices
7NEWS.com.au understands that the cuts will affect all six Australian offices. While the exact number of Australian jobs affected has not been specified, the offices collectively employ over 3000 staff. The company has not provided further details on the distribution of cuts across locations or departments.
Company-Wide Restructuring
Coleman emphasized that the layoffs are part of a strategic shift toward AI and long-term growth. Over the past year, Microsoft has redeployed more than 4000 employees into new roles. She noted that the eliminated roles are not being replaced by AI, but acknowledged that AI is changing how work gets done, requiring employees to adapt and build new skills.
“The people whose jobs are impacted today are our colleagues and friends,” Coleman said. “They have made meaningful contributions to Microsoft, and we are deeply grateful for everything they have done.” She added that the company will responsibly support those affected with care and respect.
Xbox Division Hit Hard
Microsoft's video game arm, Xbox, will be particularly affected, with more than 3200 jobs expected to be cut over the next year. CEO Asha Sharma announced that about half of those cuts were made on Monday (US time), and four game studios have been let go. She described the decision as necessary to reset the company, which had been operating at margins up to 10 times lower than comparable platform and publishing businesses.
Sharma also cited the AI boom as a factor, causing a supply shortage of computer parts and skyrocketing prices, which she called “the most severe hardware crisis in its history.” She acknowledged the pain of the changes, stating, “I know this is painful. These changes will directly affect people who have poured their creativity into building Xbox. We must reset Xbox.”
Broader Tech Industry Trend
The layoffs at Microsoft are part of a broader trend in the tech industry, with major companies such as Meta, Amazon, and Atlassian also cutting jobs in the past year. The shift reflects a focus on AI and efficiency, as companies realign their workforces to adapt to changing market conditions.
