Microsoft's Brutal Layoffs Hit Software Engineers, Product Managers and Its Director of AI

In a significant move which signals a shift in priorities by the tech giant, Microsoft has implemented substantial workforce reductions strategy which has reportedly impacted various key roles of software engineers and product managers.

This shift has forced even the company's Director of Artificial Intelligence to raise questions about the future direction and investment strategies of one of the world's leading technology firms. Artificial intelligence (AI) now handles as much as 30% of their coding tasks.

The brunt has been bore by the Software developers who experienced the most significant impact from Microsoft's job cuts in Washington, the company's home base.

According to a Bloomberg report, these tech experts constituted the largest group affected by the 2,000-employee reduction in the state.

Software Engineers Bear Brunt as AI's Role Grows

State records examined by Bloomberg revealed that more than 40% of the individuals who lost their jobs worked in software development, establishing it as the largest category of impacted employees by a considerable margin. The report from Bloomberg also noted that comparatively fewer roles in sales or marketing experienced these reductions.

It's worth noting that software developers constitute a significant portion of Microsoft's employees, even though the company hasn't released the precise figures. These reductions are a part of Microsoft's recent broader layoffs, which have impacted approximately 6,000 employees.

AI Advancement And Restructuring Drive Job Cuts

Nevertheless, these job reductions follow CEO Satya Nadella's statement last month, in which he indicated that artificial intelligence (AI) is now responsible for generating as much as 30% of the company's code.

When TechCrunch questioned Microsoft about whether the growing prevalence of AI-supported coding influenced the job cuts, the Satya Nadella-led tech firm declined to provide a statement.

While the company remained quiet regarding the reasons for these job eliminations, a Business Insider report quoted a source who knew the situation. The insider mentioned that some impacted staff would remain on the payroll for two months and still qualify for incentives and bonuses. Microsoft's representative offered no comment or verification regarding these conditions.

The Strategic Goals Behind Microsoft's Layoffs

Information surfacing last month indicated that these reductions aim to streamline the organisational structure by decreasing the number of middle management roles and increasing the proportion of software developers compared to non-developer roles on various projects.

Reportedly, Microsoft's organisations aim to broaden their 'span of control, increasing the number of employees each manager oversees. A company representative clarified that these most recent job cuts were unrelated to individual performance.

The software giant is also making every effort to reduce the 'PM ratio' in some of its groups, which refers to the proportion of product or program managers relative to the engineering staff.

AI Director Among Affected

Beyond the broad impact on engineering and product roles, the human cost of these layoffs has become even more apparent with recent reports, including a LinkedIn post from Gabriela de Queiroz, Microsoft's own Director of AI, revealing her position was also eliminated in this restructuring.

'Bittersweet news to share: I was impacted by Microsoft's latest round of layoffs,' the top executive wrote in the LinkedIn post. 'Was I expecting it? Maybe,' she added.

Reflecting on the impersonal nature of corporate restructuring, the AI Director's LinkedIn post highlighted a stark reality: 'These days, no matter how hard you work, how much you advocate for your company, or how much results and visibility you bring—whether it's helping Microsoft become a trusted name among AI startups or driving initiatives to make it a better place to work for hundreds of people—none of that makes you immune to restructuring.'

Acknowledging the situation's emotional impact, the departing Director of AI began her LinkedIn post with a direct, 'Am I sad? Absolutely,' before expressing her heartbreak over seeing 'so many talented people I've had the honour of working with being let go.'

When Even The Director Of AI Isn't Safe

She described these individuals as having 'cared deeply, went above and beyond, and truly made a difference.' She added: 'But if you know me, you know I always look at the bright side. 'Despite her sadness, the departing Director of AI emphasised her enduring optimism, stating that her 'smile, gratitude, belief that each day is a gift—that's all still here.'

She noted the immediate request to stop work and set an out-of-office but chose to 'stay a little longer—showing up for meetings, saying goodbye, wrapping up what I could. That felt right to me.'

Regarding her future, the former AI Director admitted uncertainty about her next steps, expressing her belief that something positive would emerge from the situation. She also extended support to her fellow laid-off colleagues, reminding them they were not alone, noting the figure of at least 6,000 affected individuals.

Finally, she conveyed her gratitude to those who had reached out, emphasising the significance of their kindness during this time. In a separate LinkedIn post, user Linas Beliūnas highlighted the layoff of Gabriela de Queiroz, an 18-year Microsoft veteran who significantly improved TypeScript performance, as a stark example that nobody's job is safe, concluding with a blunt assessment: 'Brutal.'

Originally published on IBTimes UK

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Microsoft, Job cuts