Microsoft executives have in recent weeks told managers at major divisions, including its cloud unit and North American sales groups, to suspend new hiring, The Information reported on Thursday, citing three employees with direct knowledge of the decision.
Executives told managers to halt the hiring of any new candidates who did not already have a job offer, citing the need to cut costs and boost margins, the report said.
However, the freeze is not company-wide and other divisions including the group building Microsoft’s Copilot AI tool are still hiring, according to the report.
Cost focus ahead of year-end
Microsoft did not immediately respond to a Reuters request for comment.
The hiring freeze comes as Microsoft approaches the end of its fiscal year in June. The company, like other tech giants, is looking to rein in costs to offset hefty investments in AI infrastructure.
Reuters reported earlier this month that Meta was planning sweeping layoffs that could affect 20% or more of the company. A source told Reuters this week that the Facebook parent was laying off a few hundred people across multiple teams.
Amazon also cuts workforce
Amazon has also trimmed roughly 30,000 corporate employees over the past six months, starting with a round of some 14,000 white-collar employees in October, tying the layoffs to efficiency gains from AI as well as reversing pandemic-era over-hiring.
Microsoft, which had about 228,000 employees globally as of June 2025, has been under growing pressure to show returns from its AI bets. The company reported slower cloud computing growth in the October-December quarter, while also reporting record capital spending on AI, spooking investors.
The Windows maker last announced wide layoffs in July, cutting about 4% of its workforce.