Microsoft CEO Satya Nadella has publicly acknowledged the emotional toll of sweeping layoffs at the company, saying recent job cuts have weighed heavily on both leadership and staff. In a memo to employees Thursday, Nadella sought to strike a balance between empathy and vision, addressing the elimination of over 15,000 positions in 2025 — a stark marker of the pressures facing even the most powerful tech firms.
The latest round of cuts came in early July, when Microsoft slashed about 9,000 roles. Investor response was immediate and positive: Microsoft’s stock closed above $500 for the first time on July 9, a symbolic milestone that also deepened the sense of disconnect for employees grappling with job losses.
“This is the enigma of success in an industry that has no franchise value,” Nadella wrote. “Progress isn’t linear. It’s dynamic, sometimes dissonant, and always demanding. But it’s also a new opportunity for us to shape, lead through, and have greater impact than ever before.”
Microsoft had 228,000 employees as of June 2024. While the company hasn’t updated that number to reflect the 2025 cuts, Nadella noted that the headcount has remained "basically flat" — a sign that internal hiring and team reshuffling may have softened the net impact. Still, the psychological cost has been significant, with employee trust and loyalty visibly shaken.
One Microsoft worker, posting anonymously on LinkedIn, wrote: “I have loved working for this company, still do, but this has done so much damage to that loyalty because it has shown that Microsoft’s espoused values do not apply to business decisions at the macro level.”
Microsoft’s layoffs mirror a broader pattern across the tech industry this year. According to industry trackers, over 80,000 tech jobs have been cut in 2025 alone. Recruit Holdings, parent company of job platforms Indeed and Glassdoor, recently announced 1,300 layoffs, citing the growing role of artificial intelligence in streamlining operations.
Despite the cutbacks, Microsoft remains one of the most dominant players in the global tech landscape. It is currently the world’s second most valuable publicly traded company, behind only Nvidia — whose AI-optimized chips have become indispensable to Microsoft's Azure cloud platform and its partnership with OpenAI.
Nadella’s memo also touched on Microsoft’s evolving identity in the age of AI. Reflecting on his decade-long stewardship of the company, he suggested that Microsoft's foundational mission — “to empower every person and every organization on the planet to achieve more” — must now evolve to meet the demands of a new technological era.
“We must reimagine our mission for a new era,” he wrote. “It’s not just about building tools for specific roles or tasks. It’s about building tools that empower everyone to create their own tools. That’s the shift we are driving — from a software factory to an intelligence engine.”
The company is set to report its fiscal fourth-quarter results on Wednesday. Analysts and investors will be watching closely to see whether the painful restructuring, rising AI investments, and workforce recalibration have translated into tangible returns. But for many inside Microsoft, the story is no longer just about performance — it’s about how success is being defined and at what human cost.