Tech company Microsoft has laid off 2.1 percent i.e. 4,800 employees. The company took this decision to spend more on infrastructure related to Artificial Intelligence (AI). The company fired many people overnight, which has posed a big challenge to their careers. Microsoft is considered a big company in the tech world, hence the layoff of such a large number of employees points towards the growing crisis in the tech sector.
Microsoft company laid off the employees on Monday, July 6, information about which was given to them through email. Microsoft has also laid off a large number of employees associated with the video game Xbox. The company said that 1,600 employees were laid off from Xbox. This is not the first tech company where a large number of employees have been laid off. Earlier this year, Meta and Amazon had also laid off thousands of employees. At the beginning of this year itself, Microsoft had laid off about 7 percent i.e. 9,000 employees in America.
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Why were the employees fired?
Emma Coleman, Head of HR, Microsoft Company, said, ‘We have laid off 2.1 percent of our company’s employees globally, so that the company can invest more on Artificial Intelligence (AI) infrastructure and provide faster and better services to the customers.’ Apart from this, Microsoft shares have also fallen heavily. The company’s shares have fallen by about 23 percent in the last 6 months, due to which the financial pressure on the company has increased.
Microsoft has laid off 1,600 employees of gaming division Xbox. Regarding this, Microsoft’s gaming head Asha Sharma said that the company’s profit has come down to only 3 percent. Due to low profits, there may be further layoff of employees.
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More money will be spent on AI
In today’s era, many tech companies are investing extensively in AI. According to Reuters report, this year tech companies have invested $700 billion in Artificial Intelligence. For this investment, companies are reducing the number of their employees. According to the report, Microsoft is also preparing to lay off 3,200 employees working in Xbox, who may be fired by 2027.
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