Microsoft lays off thousands, makes $27 billion profit in Q2 — CEO Satya Nadella doubles down on AI mania
CEO Satya Nadella Doubles Down on AI-First Strategy
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Microsoft's Tough Choice: Layoffs or Cutting AI Spending
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At a time when thousands ofare still reeling from sudden job cuts, the tech giant has posted $27.2 billion in net income for the latest quarter, a 24% jump from the previous year, as per a report. The driving force behind that growth is, according to a GamesRadar report.While the financial figures made headlines, the human cost behind them hasn't gone unnoticed. Just weeks before this earnings report,, as per the GamesRadar report. The decision sparked widespread frustration among workers, especially as the company continues to invest billions into artificial intelligence and massive data infrastructure projects, according to the GamesRadar report.ALSO READ: Atlassian boss Mike Cannon-Brookes axes 150 jobs via AI, then defends his private jet in brutal video message In a statement released with the earnings,leaned into the company's AI-first strategy, as per the report. Nadella pointed out that, "Cloud and AI is the driving force of business transformation across every industry and sector," as quoted by GamesRadar. He highlighted that, "We're innovating across the tech stack to help customers adapt and grow in this new era, and this year,surpassed $75 billion in revenue, up 34 percent, driven by growth across all workloads," as quoted in the GamesRadar report.Even previously, Nadella has highlighted superlative comments about AI, which accompanied an acknowledgement of the company's layoffs amid "thriving" financial wins as, simply, "the enigma of success," as reported by GamesRadar.ALSO READ: Morgan Stanley just boosted Nvidia's target — Here's why Blackwell chips are game-changers According to reports that surfaced in the wake of Microsoft's decision to lay off 9,000 employees, the company was faced with a stark choice: scale back its aggressive spending on AI or let thousands of workers go, as reported by GamesRadar. It clearly chose the latter option, and for many, it felt like watching a small city's worth of people lose their livelihoods so a tech behemoth could double down on its next big bet, according to the report. However, "in the amoral world of publicly traded companies, it sadly appears that it's paying off for now, wrote GamesRadar.Meanwhile, Microsoft saw a 10% boost in gaming revenue in this quarter, along with content and services revenue up 13%, which was largely "driven by growth in first-party content and," that helped balance out a 22% drop in Xbox hardware sales, as per the report. Even gaming, along with Windows, Microsoft 365, and LinkedIn, all showed growth in the latest quarter, however, the rise was not just not as much as cloud and AI, as reported by GamesRadar.Microsoft decided to cut jobs mainly to prioritize investments in AI and cloud computing, which are driving its future growth, as per the GamesRadar report.The main drivers are AI and cloud technology, especially revenue from Azure.
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