Business Insider reported Tuesday, citing sources familiar with the plans, that Microsoft (Nasdaq: MSFT) intends to cut under 2.5% of its global workforce, a reduction likely affecting more than 5,000 employees, with an announcement possible as early as this week. The cuts will hit sales, consulting, and Xbox gaming roles, according to the report.
The move follows a first-ever voluntary retirement program Microsoft rolled out in April, offering buyouts to roughly 8,750 to 9,000 US employees under a “Rule of 70” formula, in which an employee’s age plus years of service must total 70 or more. Microsoft has not disclosed how many employees accepted that offer.
Read: Microsoft Offers Voluntary Retirement to 7% of US Workforce in First-Ever Buyout Program
LinkedIn, which Microsoft owns outright, cut about 875 jobs in May, roughly 5% of its workforce, even as the company’s revenue grew 12% year over year. Reuters reported at the time that the cuts were framed internally as a reallocation toward growth areas rather than a response to AI replacing roles.
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Xbox is expected to take the deepest cuts of any Microsoft division. New Xbox CEO Asha Sharma has called the gaming business “not in a healthy spot” and ordered a “reset,” with Bloomberg reporting that the layoffs will begin after Microsoft’s fiscal year closed June 30, with several studios, including Compulsion Games and Undead Labs, reportedly negotiating for independent status to avoid closure.
Duke Nukem co-creator George Broussard, citing an unnamed insider, said on social media that the cuts could be the largest single layoff event in gaming industry history — a claim that has circulated widely in gaming press but has not been confirmed by Microsoft or verified against a specific number.
Related: Microsoft, Google, Meta Just Had Their Best AI Quarter Ever—and Their Workers Paid for It
Microsoft’s H-1B visa sponsorship has drawn renewed scrutiny alongside the cuts. The company has consistently ranked among the largest H-1B filers in the country in recent years, though its exact position varies by year and by visa category. It placed second among all visa sponsors for total labor certifications in fiscal 2025, while ranking lower for new-employment approvals specifically.
Microsoft employed roughly 228,000 people worldwide as of June 2025. The company has already cut close to 16,000 jobs this year across the layoffs, the voluntary buyout program, and division-specific reductions at LinkedIn and Xbox.
