Satya Nadella, the CEO of Microsoft, wrote a memo that strikes a delicate balance. It talks about the human cost of change while also pushing Microsoft toward an AI-driven future that promises growth, but not without sacrifice.
Microsoft’s employees have been cut by more than 15,000 jobs this year, which is a big drop. It seems that the emotional toll of the layoffs is now affecting CEO Satya Nadella himself. In a heartfelt memo sent to employees on Thursday, Nadella talked about the company’s most recent round of layoffs, which affected about 9,000 people in early July, and the stress that was spreading through teams.
Nadella wrote, “Before anything else, I want to talk about what’s been bothering me and what I know many of you are thinking about: the recent job losses.” Microsoft had228,0000 employees around the world as of June 2024. Nadella said in his note that the total number of employees is still “basically flat,” even though the company hasn’t given an updated number that includes the cuts in 2025.
Even though the company cut many jobs, investors still have a lot of faith in it. On July 9, just a week after the announcement of the last layoffs, Microsoft’s stock closed above $500 for the first time. The rise mostly stems from Microsoft’s strong position in artificial intelligence, cloud computing, and enterprise software.
He didn’t hide the contradictions.
Nadella wrote, “This is the mystery of success in an industry that doesn’t have any franchise value.” “Progress does not follow a linear path.” It’s always changing, sometimes not in harmony, and always hard. But it’s also a chance for us to shape, lead through, and have a bigger impact than ever before.
Microsoft isn’t the only company that has to make tough staffing decisions. In 2025 alone, more than 80,000 jobs were cut in the tech industry as companies adjusted to a world where AI is the main focus. Recruit Holdings, the company that runs job sites Indeed and Glassdoor, recently announced that it would be cutting 1,300 jobs in its HR tech division. The CEO said that artificial intelligence was the main reason for the cuts.
It’s funny that AI is also what makes people supporters of Microsoft. Azure, the company’s cloud computing arm, has grown faster because AI companies like OpenAI are buying Nvidia chips to train and run their big language models. Microsoft’s long-running franchises, Windows and Office, are still going strong, giving the company a strong base for its AI plans.
Nadella’s memo acknowledged the chaos, but it also marked a new phase in Microsoft’s larger vision. The company’s mission for the past ten years has been “to empower every person and every organization on the planet to achieve more.” He says that this way of thinking needs to change for the AI age.
He wrote, “We need to rethink our mission for a new time.” “Wh” t does empowerment look like in the age of AI? It’s not only about making tools for certain jobs or roles. It’s about making tools that give everyone the power to make their own. We’re making the change from a software factory to an intelligence engine that gives everyone the tools they need to build what they need to reach their goals.
Microsoft is now entering a crucial earnings season, with emotions running high and changes being made to its strategy. On Wednesday, the company will release its fiscal fourth-quarter results, which Wall Street and its employees will be watching closely.
At Microsoft, people are both nervous and ambitious. As the company moves more into AI and cuts back to become more efficient, people are still wondering how it will change and what its purpose will be.
