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Microsoft to Lay Off Thousands as It Focuses on Cloud Software: Reports

Microsoft to Lay Off Thousands as It Focuses on Cloud Software: Reports

By Alex Schiffer, The Washington Post | Updated: 4 July 2017 09:38 IST

Highlights

Microsoft is set to cut thousands of jobs across the globe
The company will focus more on marketing and selling its cloud software
Microsoft will announce its future plans on Wednesday

Worldwide layoffs are reportedly about to hit Microsoft.

According to several news outlets, the software giant is set to cut thousands of jobs across the globe in an attempt to reorganise its sales force. The news could come as soon as this week.

The reorganisation is going to include Microsoft's enterprise customer unit and one or more of its subject matter experts-focused divisions (SMEs), TechCrunch reported.

The move dovetails with the company's plans to focus more on marketing and selling its cloud software, Azure, according to Bloomberg. For years the Redmond, Washington-based company had focused on selling software for desktops and servers. Now the company wants to put more effort into persuading customers to buy cloud services hosted by Microsoft data centers to be more competitive with market leader Amazon. (Amazon chief executive Jeffrey P. Bezos also owns The Washington Post.)

Friday marked the end of Microsoft's fiscal year and the first under new executives Judson Althoff and Jean-Phillipe Courtois, who took over the company's sales and marketing divisions last summer after the exit of chief operating officer Kevin Turner, who held the position for 11 years. Over the years the company has usually announced staff reductions around this time.

In the third quarter of the fiscal year Microsoft announced that Azure nearly doubled its revenue growth from the previous quarter. At the time, the product saw a sales growth of 93 percent. Microsoft's growth in cloud revenue will be a key indicator of its progress in transitioning away from legacy businesses.

Last summer the Seattle Times reported that Microsoft would cut 2,850 jobs, with 900 coming from its sales force. Two months earlier, the software company had announced that it would lay off 1,850 staff members in its smartphone division. In July 2015 Microsoft cut 7,800 jobs after its acquisition of Nokia.

A report from the Puget Sound Business Journal said that Microsoft will announce its future plans on Wednesday.

Microsoft didn't immediately respond to a request for comment.

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