Layoffs potentially numbering in the thousands started Thursday at Microsoft, CNBC reports. "Today, we are taking steps to notify some employees that their jobs are under consideration or that their positions will be eliminated", a Microsoft spokesperson told CNBC.
The Microsoft email last week said the reorganization was meant to sharpen its focus on "six priority industries": manufacturing, financial services, retail, health, education and government. Last July, Microsoft laid off almost 3,000 people from its smartphone and sales teams.
Microsoft has 71,000 employees in the United States and 121,000 around the world.
"The shifts will be some of the most significant in the sales force in years", the report said. Microsoft doesn't give specific revenue figures for its cloud computing platform, Azure, but said in its most recent earnings report that Azure revenues grew 93%.
Satya Nadella, chief executive officer of Microsoft, speaks during a Microsoft launch event to introduce the new Microsoft Surface laptop and Windows 10 S operating system, May 2, 2017 in NY. And Microsoft is using this action as an opportunity to cull other employees, including those that are close to retirement and will be offered an early leave. The following year brought another 7,800 layoffs, while the company announced another round of up to 1,850 job cuts last year. "This is classic 'rotation, ' where Microsoft is replacing people with skills on traditional enterprise offerings with those more skilled in the cloud, AI and vertical apps". At the time he stated his intention of turning Microsoft into a cloud services company, and has made good on that promise with the company now issuing updates on a near-weekly basis.
Nadella, who came up through the firm's cloud division, has narrowed Microsoft's focus and doggedly trimmed the company's workforce.