Microsoft CEO Satya Nadella reveals reason behind laying off 6000 employees

Satya Nadella

Microsoft recently laid off about 6,000 employees, which is around 3 percent of its global workforce. Now, CEO Satya Nadella has opened up about why the company made this move.

Speaking at a company-wide town hall, Nadella said the layoffs weren’t about employee performance but were part of a larger internal reorganisation. “This was about reorganisation rather than performance,” he told employees. According to Nadella, Microsoft is realigning its priorities to focus more heavily on artificial intelligence (AI), which is where the company sees its future.

Microsoft is planning to invest a whopping $80 billion this year in AI infrastructure. That includes expanding its AI capabilities and rolling out its Copilot AI assistants across various platforms and services. In this shift, some roles, especially in product development and engineering — are being restructured or phased out to make way for new ones better suited to Microsoft’s AI vision.

Meanwhile, Microsoft’s Chief Product Officer, Aparna Chennapragada, also weighed in during the same event. She pushed back against the growing idea that coding or studying computer science is becoming obsolete. “I fundamentally disagree with the notion that people should not study computer science or that coding is dead,” she said, reassuring both employees and aspiring developers.

So while Microsoft may be making tough calls in the short term, the company’s leaders are making it clear: this is all part of a bigger, AI-first future they’re betting big on.