Microsoft Cuts Less Than 1% Of Workforce, Citing Performance, As AI Hurdles Persist

Microsoft is cutting less than 1% of its workforce across departments based on employee performance, according to a spokesperson. The company had 228,000 employees as of June. Microsoft’s stock rose 12% last year, underperforming the Nasdaq's 29% gain, despite a net income margin near a two-decade high. The company also faces challenges with its AI partner OpenAI, which it has funded with over $13 billion. The partnership, described as having “cooperation tension” by CEO Satya Nadella, has yet to yield widespread adoption of Microsoft’s AI-driven tools like the Microsoft 365 Copilot. Revenue growth in its Azure cloud unit is expected to accelerate this year due to increased AI infrastructure capacity.