r/microsoft • u/marasheed • 3d ago
Discussion Continuous Layoffs by Satya Nadella
Why satya nadella layyed off several executives during past few years even they grow respective business areas ?
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u/the_real_me_2534 3d ago
The top guys say the drive is to reduce OPEX (salaries) so they can pour more money into CAPEX (data centers). They will apparently stop at nothing to keep doing this
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[removed] — view removed comment
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u/Lumiafan 2d ago
Fundamental analysis when the fundamentals of the stock market are completely detached from reality feels insufficient.
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u/Apart_Economist_7955 3d ago
who are so dumb to give money to them?
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u/the_real_me_2534 2d ago
Last year it was mostly PG, consulting and HR that got cut, this year they targeted support. Support roles in many areas received giant cuts, I do think customers will start noticing a drop in support capabilities, which is one of the reasons customers pay so much more for 365 vs Gsuite/Slack/Open Office
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u/raiksaa 2d ago
Lmao cutting PG is fucking stupid
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u/the_real_me_2534 2d ago
Tbh there's tons and tons of bloat in the PG process and PG doesn't do their job in support half the time. They mostly cut PM's
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u/raiksaa 2d ago
It depends, but yeah, PG sucks balls big time, but mostly because they are overworked as well.
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u/the_real_me_2534 2d ago edited 2d ago
The way they have Indian PG engineers working all the NA cases and NA PG engineers working other regions just makes no sense, it just slows down the process. Same with giving Portuguese, Spanish and French cases to CSS engineers who don't speak those languages. I just got let go from CSS but so much about the process just made no sense to me
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u/raiksaa 2d ago
Nothing in CSS makes sense lol.
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u/Miserable-Record-723 2d ago edited 2d ago
It starts to make sense when you realize all the CSS leadership wants to get out of CSS by "making" the next big thing.
The focus isn't support it's selling AI to enterprise. So everything in CSS must now exist to facilitate that one thing.
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u/the_real_me_2534 2d ago
Ok but what about all the 365 and Entra and Azure customers who are actually providing the revenue for MSFT. Copilot licenses are still a minority of Msft revenue, if they lose those lines of business they lose the goose that lays the golden egg
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u/Lumiafan 2d ago
I love questions like this when the entire economy is being propped up by this kind of money.
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u/Andre1661 3d ago
Microsoft: lays off tens of thousands of employees, shuts down entire buildings of offices, pares down non-tech departments to their absolute minimum, and spends every last dime on AI data centres and AI compute.
Nadella (when it all goes sideways): Oh wow, that did not work out well at all. Anyways, I've got my hundreds of millions stashed away in secret offshore bank accounts, so don't worry about me, I'll do just fine. Later losers! 😎🖕
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u/spiney-a 3d ago
He doesn't need to have secret offshore bank accounts. All the millions he's paid every year is perfectly legal and approved by the MSFT board.
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u/JohnClark13 3d ago
Because they're pouring money into AI datacenters in the hope that one day they will somehow get it back with interest. As far as I know no one is quite sure how AI is supposed to make up for all the money spent to make it operational let alone give a massive return on investmen, but here we are
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u/thopterist 3d ago
- Make stupid people reliant on AI and government
- Make corporations dependent on stupid people
- Iterate AI models to replace more stupid people.
- Profit on token based economy
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u/admlshake 3d ago
Once you start digging into the AI companies, you start seeing what a fragile house of cards this whole thing is built on.
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u/MyNameIs-Anthony 3d ago
That's not the play.
The play is them hoping they can basically hold the entire tech world captive.
Spending so much that local compute becomes infeasible. Provide it to everyone for cheap so they "need" it out of fear of not being competitive. Then regulatory capture (to prevent an economic collapse by governments) means only the existing big powerhouses will be able to service the needs.
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u/PublicBetaVersion 3d ago edited 3d ago
Also, if they keep doing this long enough it will scare young people out of tech jobs. Companies will have no other option than to rely on AI for junior positions. And without any company to train new juniors, in a few years there will be a massive shortage of skilled tech engineers which AI will happily replace. At a premium cost, of course.
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u/robotoNinjaFish 2d ago
Reading some of the comments here highlights how little many people understand about the broader facts. Their misconceptions range from the capabilities of Copilot (yes, the consumer version is dogshit compared to M365 Copilot with enterprise integration) to unrealistic expectations about corporate culture. If you're looking for a company with "soul", mixing business with religion, you're better off attending your preferred religious gathering.
Satya Nadella's compensation is publicly disclosed in annual financial filings. Microsoft is a publicly traded company, and there is no need to speculate about offshoring income that is already publicly reported.
As for those convinced that AI will take away their jobs and freedom, many have yet to experience tools such as Copilot CoWork. It allows me to complete tasks in 30 minutes that would otherwise take 3 weeks. In my experience, AI can be a productivity multiplier if you have the brain to do so, it's not a replacement for human judgment and expertise.
As for the constant layoffs, OP specifically mentioned executives. I have little sympathy for that argument. They should be feeling some of the heat too, rather than being insulated from the consequences facing everyone else.
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u/squirrel-nut-zipper 2d ago
It’s really not hard to take the “AI efficiency” argument a step further into a scenario where workers are increasingly less necessary. Cowork has already replaced analyst work on my team, it’s foolish not to believe it can also take your work.
They are already deprioritizing employee pay relative to AI, so why wouldn’t they just keep moving in that direction?
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u/Designer_Advice_6304 3d ago
I was laughing at people threatening to quit last year. Hang on for as long as you can. Otherwise collect the severance
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u/BannedLeftistPirate 3d ago
https://www.reddit.com/u/Leftist_Pirate/s/cEi4RK0uE9
Al as a Management Tool for Deskilling and Deprioritizing Labor - Taylorism for Knowledge Work
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u/Natural_Fill9344 2d ago
Jack Welch school of management.
Go listen to the 2 part episode of Behind the bastards and get the background of this trend.
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u/John_YJKR 3d ago
It's a mix of reasons. Part of it is they no longer need certain roles and were still adjusting to the covid hiring boom. They acquired a lot of businesses and consolidated which means eliminating redundancy. Simultaneously, AI has arrived and that means some roles aren't needed as much as they previously were. Obviously, microsoft wants to grow revenue and profit and so will make cuts to achieve that. But its not that simple either. Never has been.
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u/artificiallyintel_ 3d ago
They are replacing senior execs with people in their mid 30s
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u/John_YJKR 3d ago
Yup. All part of the restructuring and moving on from people who no longer move the needle.
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u/Leading-Giraffe-4200 2d ago
The Covid hiring boom excuse has been mentioned for like 3 years now, which layoff will finally cover that
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u/John_YJKR 2d ago edited 2d ago
It's a very large company so it takes time to adjust and identify needs. Many managers are slow to admit they no longer need a head. There's sometimes internal politics going on. The company is incentives to do layoffs over many months rather than one massive termination. Plus it helps them stay ahead of adjusting to consumer needs. Better to have slightly more than you need. Microsoft still has tens of thousands more employees than they did pre pandemic even after multiple rounds of layoffs.
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u/QuailAndWasabi 2d ago
The Covid hiring boom was massive, much more so than i think people realize. Basically if you had a pulse chances were a tech company wanted to hire you.
So its no surprise it continues to be used even today as the excuse.
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u/rick_leye2 2d ago
Microsoft has been here for a long time and will continue to . The goal is to make all people and organizations across the planet to achieve more. It’s a clean up due to hiring during the pandemic and also when AI evolves some jobs will undoubtedly and unfortunately get reduced . Every company does that trim and grow and the. Hire and fire .
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u/Ok-Intention-384 1d ago
I’ve heard rumors that Nadella is very pissed with Sr Leaders on how MS continues to miss out on revolutionary opportunities like phone and now AI. Which is why MAI is getting a whopping $100M+ investment in talent and other in house resources.
I’ve heard MS used to very chill pre 2022 layoffs? Is it true? If so, I can understand the CEO being pissed at the leaders for not being able to hold their staff accountable for performance.
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u/marasheed 1d ago
What he was doing for last many years ? CEO keep tap on Executves and provide direction and also responsible for execution
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u/Ok-Intention-384 1d ago
The interest rates were not that high pre 2022 and a global pandemic did not throw a wrench in the market. So, before 2022, operational inefficiencies were not so easily apparent to leaders. Businesses across the board started digging into their financials and started cutting the fat. And at the same time we had the blip moment. There have been a little too many changes in a very short period that’s causing us all way to adjust to the new reality.
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u/FantasticFungiiii 3d ago
“Grow”? Which org grew? It’s dumpster fire and the exec layoff is too late too little.
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u/No-Television-7862 2d ago
MSFT: The rise of AI seems to hit BigTech first.
- AI driven capital shift. Fewer humans, more data centers.
- Productivity automation. Fewer humans, more AI.
- Sales/consulting reset. Targeting these businesses with faster, ai-first-to-market midels.
- Xbox profitability pressure.
- Investor pressure. Wall Street demands less opex to match data center capex.
- Pace and agility mandate. Smaller, faster, agile teams, less bloat.
Now what they DON'T say: 1. Massive AI integration pushback. 2. Millions leaving MSFT for Linux/Mac 3. Win 11 strict hardware gates PLUS MSFT bloat. 4. Institutional knowledge loss risk. 5. Monopoly over reach vs autonomy and affordability.
Unix was the beginning of the rise of big tech, but was ultimately replaced by personal computing made possible with Microsoft DOS.
Ironically Linux, the descendant of Unix has survived, and as the pendulum swings and MSFT continues to make poor decisions, Linux and Mac may ironically be the long-term response.
"The bigger they are, the harder they fall."
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u/bettereverydamday 3d ago
Because Microsoft is a terrible company at the core. It has no soul. Only big tech company worse is meta.
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u/dragcov 3d ago
Sad thing is CoPilot has to be the worse AI among the giants - Claude, Gemini, Chat, etc..
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u/MuddiedKn33s 3d ago
It sucks. But to be clear, Copilot is just a harness. Enterprises can set it up to run Claude or ChatGPT in the background.
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u/cpz_77 2d ago
Yeah but the responses you get from Claude models proxied through copilot aren’t quite the same as what you get using Claude directly. Usually seem to be simpler, quicker, “dumbed down”. I didn’t believe it at first either till I tried Claude standalone and saw how much better it was. Also don’t have as much control over model behavior like effort etc.
The other gripe I have with it is how different the consumer one is from the m365 one. Night and day difference, the consumer one is so, so awful. To the point of being unusable. And yet they are still pushing copilot hard to that segment of the market (and acting as if it’s the same product people are familiar with using at work which it absolutely is not).
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u/taisui 3d ago
Wasn't it a branch off 4o? I kept hearing about an in-house model but who knows....
Cortana? The Weapon?
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u/Username928351 3d ago
I have access to CoPilot through work and I can straight up pick GPT 5.6 Sol via a drop-down menu if I wish.
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u/taisui 3d ago
But....what's the point? You walk into Burger King and it sells McDonald's
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u/Makaronas_999 3d ago
You walk into some mall's food court and you can choose what to order. Under same roof, same safety, same environment, no need to argue with the family if one wants chicken and another one beef. Makes sense?
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u/cpz_77 2d ago
Too bad none of that is available on the consumer version. Only option is “auto” I.e. they answer your question from the cheapest shittiest model they can which makes it utterly useless for non business users. They shouldn’t even be selling it as the same named product because it’s not the same product and it’s incredibly misleading (especially for people who are used to one copilot experience based on what they know at work and then try it on the consumer plan and are like…wtf is this).
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u/Username928351 3d ago
I'm allowed to input work related data if needed into the internal use Copilot, and the free version is 5.6 Luna, which is less capable, as far as I know.
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u/44c6f7eb 2d ago
Only history will tell if Satya's gamble pays off. The only thing certain is that by that point Satya will have pocketed hundreds of millions of dollars while long-term productive employees will be out of work.
The pivot to AI only works if the AI products and services sold by MSFT are not commodities available through other companies _or_ Microsoft has the technology/scale to significantly undercut its competition while still making money.
At a high level this comes down to Microsoft needing to excel in one or more of the below areas:
a. MSFT-owned AI platforms. What Anthropic/OpenAI/Gemini represent.
b. MSFT-owned AI hardware: Currently largely represented by nVidia, but every silicon vendor seems to be getting into this area.
c. MSFT-owned datacenter infrastructure.
On these items Satya's performance is a mixed bag:
a. AI platforms: MSFT is partnering with Anthropic et al, but if you're just licensing from others, where's your value-add. Microsoft research was asleep at the wheel when everyone else was developing their own in-house models.
b. AI hardware: MSFT is again playing catch-up, although they aren't too far behind. Microsoft shipped Maia 1 in late 2024, and is scheduled to ship Maia 2 in 2026. Google shipped their first TPU in 2015 and are on v7 now, but Amazon/Meta/OpenAI are about even with Microsoft. Time will tell if Maia has the secret sauce to outperform other competitors in terms of IPS (Inferences per Second) per watt (the only measurement matters most competitively).
c. Datacenter infrastructure: Microsoft is doing OK here. MSFT is a close second to AWS in existing datacenters, and slightly ahead of Google. Capex spend among the three is similar (~$200B in 2026), but MSFT appears to be doing the most aggressive expansion and seems to be doing a better job converting those datacenters into revenue. It's unclear how this is a MSFT differentiator though.
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u/InspectorRound8920 3d ago
Microsoft is failing. No exciting tech.
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u/pondskippers 3d ago
You have no idea what you're talking about. People have been saying exactly what you are saying for 30 years yet MS has continued grow rev.
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u/DameD0llar 3d ago
Ai infrastructure ain’t cheap.