Rumors have been circulating online that Microsoft is preparing to cut tens of thousands of jobs. TipRanks reported that the company is “considering massive layoffs” this month, potentially eliminating between 11,000 and 22,000 roles across the Azure Cloud, Xbox, and global sales teams.
According to The Seattle Times, the claims appear to have originated on anonymous online forums like Reddit and Blind before rapidly spreading across Bluesky and X, drawing widespread attention and, in turn, swift denials from Microsoft executives.
Microsoft’s chief communications officer, Frank X. Shaw, took to X to refute the rumors, calling them “100 percent made up/speculative/wrong.” He also responded to a post suggesting the layoffs would materialize in weeks, sarcastically replying, “i eagerly await.” Jez Corden, editor at Windows Central, also pushed back on claims, writing on X, “false on the Xbox side at least.”
Large-Scale Microsoft Layoffs Are Not Unprecedented
The company carried out significant workforce reductions in 2025, cutting more than 15,000 employees between May and September. In July alone, Microsoft laid off roughly 9,000 employees. At the time, Phil Spencer, head of Xbox, wrote in a memo to staff that the cuts were “necessary” for the company’s longevity, arguing they would “increase agility and effectiveness.”
Microsoft’s recent layoffs reflect the growing financial demands of artificial intelligence. AI itself is not necessarily replacing workers. Rather, the sheer cost of building AI systems is forcing budget restructuring, leading to cuts. During the 2025 fiscal year, Microsoft spent approximately $88 billion developing its proprietary AI systems. As investment in AI continues to surge, the company has increasingly looked to trim costs elsewhere to offset that spending.
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This article originally appeared on Fast Company’s sister publication, Inc.
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