Microsoft layoffs: Microsoft CEO Satya Nadella’s recent memo to employees describing job cuts during record-breaking profits as the “enigma of success” has sparked a storm of internal backlash. Staff across the company are reacting with growing suspicion, anger, and speculation about what may lie ahead.
The tech giant has laid off thousands of workers this year, despite reporting $75 billion in profits over the past three fiscal quarters and unveiling plans to invest $80 billion in artificial intelligence infrastructure in 2025. Its stock also hit a record high earlier this month, raising further questions about the justification for job cuts.
While at least 2,000 employees were let go citing underperformance, AI automation played a key role in the rest, contributing to a total of around 9,000 layoffs so far. CEO Satya Nadella’s recent memo sought to explain these decisions, even as Microsoft continues to post record earnings and strike multi-million-dollar AI deals.
Nadella’s message, intended to address these concerns, appears to have had the opposite effect among many employees.
Political criticism and internal stress
The memo came just a day after US Vice President JD Vance criticised Microsoft for allegedly replacing American workers with H-1B visa holders. Nadella, in turn, wrote that “our overall headcount is relatively unchanged,” while also acknowledging that “we’ve undergone layoffs.”
He framed the apparent contradiction as an “enigma of success in an industry that has no franchise value.” But employees saw it differently.
One staff member told Business Insider they couldn’t tell if the memo was “an apology or a warning.” Another said Microsoft was “prioritising KPIs over people,” suggesting the company was more focused on performance metrics than employee well-being.
Backlash
Microsoft’s internal tensions became more visible on Blind, an anonymous professional message board requiring a Microsoft email to access. Here, employees didn’t hold back.
One user posted a parody titled “A quick memo on your continued utility,” mocking Nadella’s tone and accusing leadership of fostering “chaos, shifting teams, and cancelled projects” to keep workers compliant and fearful. The post claimed that uncertainty was no accident, but a management tactic.
Another user, pretending to be Copilot, Microsoft’s AI assistant, criticised the memo for failing to acknowledge the emotional toll of layoffs or offer any concrete support. The parody noted that the reasoning behind job cuts remained opaque, leaving workers to speculate.
Several Microsoft employees and observers now suspect Nadella’s note was crafted not for internal morale but as a message to investors. “They knew it would leak,” one Blind user wrote. “This was signalling to Wall Street: layoffs are happening, business is booming, and we’re not done yet.”
This theory has taken hold among many inside Microsoft, who feel the memo lacked empathy and transparency. One employee compared the company to a coal mine, where management is focused solely on output, regardless of the human cost.
While Microsoft spokesman Frank Shaw noted that employee reactions ranged “from positive to constructive,” internal sentiment remains divided. The company has yet to release new survey data since the latest cuts, but informal polls suggest unease is rising.