Microsoft reportedly planning to cut thousands of job this month; numbers may cross 20,000, more than ...

Update: Microsoft Chief Communications Officer Frank X Shaw has denied the report in a post on X, formerly Twitter. "100 percent made up / speculative / wrong," wrote Shaw.


Microsoft is reportedly gearing up for another round of job cuts. According to a report in TipRanks, an investment news website, Microsoft is set to announce layoffs this month. Reports suggest that the company may lay off between 11,000 and 22,000 jobs across various divisions in the third week of January. If the figures turn out to be true, this would be the biggest layoff round yet for the Windows maker. Also, this will be the fourth consecutive January when Microsoft will cut jobs. The layoffs are reportedly related to rising costs of AI investment. Most of that money is said to be going toward data centers, chips, and AI tools.


Microsoft is one of the biggest proponents of AI. The software giant spent upwards of $80 billion on the tech last year, and that doesn't seem likely to slow down this year. Analyst projections had previously suggested that Microsoft may need to cut at least 10,000 employees annually just to offset increased capital depreciation costs from data center expansion.

In 2023, Microsoft cut 10,000 jobs, reported to be 5% of its workforce. In January 2024, Microsoft gaming team took the major brunt of the hit as Microsoft cut 1,900 employees, around 1% of its workforce. The year 2025 was by far the worst. In January 2025, the company cut off slightly less than 1% of employees, claiming them to be performance-related job cuts. More jobs were cut in May, 3% of the workforce was cut that month, and an even bigger number in July, when Microsoft removed another 4% of its employees. In all, Microsoft cut more than 15,000 jobs across several rounds in 2025. In total, these were likely Microsoft’s largest round of layoffs since the elimination of 10,000 roles in 2023.

Jobs likely at risk and those stable

According to Tipranks, reports from workers point to Azure cloud teams, the Xbox gaming unit, and global sales as key teams to be impacted. It further says that "analysts believe Microsoft is moving funds away from payroll and into long-term tech assets. As a result, middle managers and older product teams may face a higher risk," but "roles tied to AI research and core cloud work are seen as more stable." Also, "roles tied to AI research and core cloud work are seen as more stable. This reflects the company’s goal to stay competitive in AI development."

Stricter work from office rules

The TipRanks report also reveals that Microsoft plans to enforce stricter office policies starting from February 23, 2026. Employees residing within 50 miles of an office will be required to work on-site for at least three days per week.