Microsoft Signals Workforce Reduction, CFO Amy Hood Outlines Cost Measures

Microsoft expects its headcount to decline over the coming quarters as part of operational changes, Chief Financial Officer (CFO) Amy Hood indicated during the latest earnings call. She said the company is modifying its structure to improve execution and pace, which will lead to a year-on-year (YoY) reduction in employee numbers.

The company has already implemented cost measures, including job cuts and a voluntary buyout programme. The scheme applies to employees whose combined age and years of service reach a set threshold, with some roles excluded. Based on its global workforce of about 228,000 as of June 2025, a section of employees could qualify. The restructuring comes alongside strong financial results. Microsoft reported quarterly revenue of USD 83 billion and net income of USD 32 billion. Its cloud segment generated USD 54.5 billion in revenue, while its artificial intelligence business recorded an annual revenue run rate exceeding USD 37 billion. The company also expects continued growth in its Azure platform.

Microsoft is also revising its compensation structure to give managers more flexibility in awarding stock-based incentives.