Microsoft CEO Satya Nadella has addressed more than 15,000 employees affected by the company’s multiple layoff rounds in 2025, expressing gratitude and acknowledging the emotional toll of the decisions. The message, part of an internal memo released during Microsoft’s fourth round of job cuts, offers a rare blend of empathy and justification as the company reorganises around artificial intelligence and operational efficiency.
What Nadella said
In the memo shared with employees, Nadella wrote: “Before anything else, I want to speak to what’s been weighing heavily on me… These decisions are among the most difficult we have to make. They affect people we’ve worked alongside, learned from, and shared countless moments with.” He added: “I want to express my sincere gratitude to those who have left… And for that, I am deeply grateful.”
The statement follows the latest elimination of 9,000 roles—bringing the year’s total to over 15,000 job cuts across divisions including engineering, gaming, and middle management. The memo and layoff details were first reported by Windows Central.Layoffs despite profits
Microsoft’s job cuts come at a time of strong financial performance. The company recently reported $25.8 billion in quarterly net income, up 18% year-over-year. Yet the restructuring continues. Layoffs began with performance-based reviews earlier this year, followed by major trims in May, June, and July.
The gaming unit has seen a particularly heavy impact, losing more than 3,000 positions. Studios like The Initiative were shut down, and games such as Perfect Dark were cancelled, despite a record year for Xbox.
AI and organisational shift
Nadella also attempted to explain the paradox of layoffs amid profits. He referred to Microsoft’s transformation into an “intelligence engine” and noted that AI now writes up to 30% of the code in some teams. Microsoft is investing $80 billion in AI infrastructure this fiscal year and reducing management layers to move faster.
This reorganisation follows similar moves by other tech giants like Amazon and Meta. As Microsoft enters its new fiscal year, Nadella’s message underscores the human cost of automation-driven change, even as the company continues to lead in AI.
The company said affected employees would receive severance packages, extended healthcare, job placement support, and priority for internal roles. Yet Nadella’s message—ending with “for that, I am deeply grateful”—may be remembered more for tone than strategy.
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