The reductions affect fewer than 1 in 40 of Microsoft’s 220,000 employees and follow a voluntary retirement program earlier this year.
Microsoft plans to eliminate thousands of positions across its sales, consulting, and Xbox divisions. The layoffs, expected to be announced next week, will impact less than 5% of its 220,000-strong workforce. Some affected employees may transition to other roles within the company.
This round of cuts follows a voluntary retirement program launched earlier in 2026, which reduced the need for broader reductions. About a third of the 9,000 eligible U.S. workers opted for buyouts. Last year, Microsoft conducted two separate layoff rounds, totaling 15,000 jobs, or roughly 4% of its workforce.
The company has historically aligned workforce reductions with the start of its fiscal year on July 1. Xbox-specific cuts had been anticipated for weeks, reflecting ongoing adjustments in its gaming division.