Microsoft has announced another round of mass layoffs, affecting about 9,000 employees globally—its largest since 2022. This latest cut targets around 4% of its workforce and follows earlier reductions of 6,000 jobs in May and additional cuts in June. The layoffs impact multiple divisions, including Xbox and sales, with significant losses in software engineering and product management.

The company says it’s streamlining operations and reducing management layers to stay competitive in a rapidly changing market dominated by AI and cloud computing. Analysts suggest Microsoft is shifting resources toward faster-growing areas like artificial intelligence, having invested heavily in data centres and chip infrastructure.

For the Canadian job market, this reinforces ongoing volatility in the global tech sector. Microsoft’s recent acquisitions—including Activision Blizzard and Bethesda—had Canadian ties, and layoffs could ripple into those studios. With AI-driven tools like code generation also reducing demand for traditional tech roles, Canadian workers—especially in gaming and software development—may face tougher competition and slower hiring in the near term.

Professionals in Canada’s tech scene should keep an eye on emerging AI and cloud opportunities as the sector continues to evolve.

Have you been laid off by Microsoft in Canada? Contact our employment lawyers today. Our legal team offers a free consultation and works on a contingency basis—there are no fees unless you win your case.

The Associated Press’s original article, “Microsoft’s largest layoff in years hits Xbox, sales and other divisions” was published in BNN Bloomberg News on July 2, 2025. Read the Full BNN Bloomberg News story.