New Delhi: After a year of major layoffs, Microsoft is preparing to expand its workforce again, but this time with a clear focus on artificial intelligence (AI).
Speaking on the BG2 podcast with investor Brad Gerstner, Microsoft CEO Satya Nadella said the company’s workforce will increase in a “smarter and more advanced” way, powered by AI technology.
“We will grow our workforce,” Nadella said, adding that future hiring will be determined by how AI increases productivity across the company.
Microsoft had around 2.28 lakh employees at the end of June 2025, and this number remained virtually unchanged after several rounds of job cuts that affected more than 15,000 employees.
In contrast, before the AI boom in 2022, the company’s workforce had grown by 22 percent.
The hiring slowdown came as Microsoft shifted its focus to investments in AI infrastructure, partnerships and tools such as Microsoft 365 Copilot and GitHub Copilot.
Nadella explained that the company has entered a new phase – not of mass hiring but of “targeted scaling,” in which AI enables smaller teams to achieve much more.
He described this as an “unlearning and learning process” in which employees must adapt to using AI in every part of their work, from research and planning to execution.
He shared an example of a Microsoft executive using AI agents to manage the company’s fiber network operations when staff could not keep up with growing demand.
“That’s an example of a smaller team achieving more thanks to AI,” says Nadella.
Meanwhile, multiple reports earlier this year suggested that Microsoft has laid off 4 percent of its workforce, or about 9,000 employees, due to a new round of job cuts this year.
According to The Seattle Times in July this year, employees of Microsoft’s Xbox division, better known as Microsoft Gaming, are being hit hard by these layoffs.
“To position Gaming for continued success and allow us to focus on strategic growth areas, we will eliminate or reduce work in certain areas of the business and follow Microsoft’s lead in removing layers of management to increase flexibility and effectiveness,” Xbox leader Phil Spencer said in a message to the team.
(Except for the headline, this article was unedited by FPJ editors and was auto-generated from an agency feed.)
