Microsoft lays off staffers from its Azure division

Microsoft has confirmed that it was laying off staffers from its Azure unit but did not provide an accurate number of employees affected.

“Organizational and workforce adjustments are a necessary and regular part of managing our business. We will continue to prioritize and invest in strategic growth areas for our future and in support of our customers and partners,” a Microsoft spokesperson said.

The layoffs, which were first reported by Business Insider, have impacted the Azure for Operators (AFO) and Mission Engineering teams.

While the Insider report cites a source claiming that at least 1,500 staffers were impacted, another person in the know of things suggested that the number might be highly inflated, at least for the AFO team.

The AFO team conducts research and development in multiple areas of networking, security, and systems. “We build working systems, engage with academia, publish scientific papers, publish software for the research community, and deploy cutting-edge technologies to Azure and our customers,” according to the Microsoft portal.

On the other hand, Microsoft’s Mission Engineering team, which is a part of the company’s Strategic Missions and Technologies (SMT) team, focused on areas such as space.

Microsoft combined its US Federal business, Azure Space & Mission Engineering, Azure for Operators, and Azure Quantum under Jason Zander in 2021 with the mission of accelerating several of Microsoft’s key businesses. Zander directly reported to CEO Satya Nadella.

The fresh round of layoffs at Microsoft comes just months after the company eliminated 1,900 roles across its Activision Blizzard and Xbox divisions.

However, Microsoft has been growing its cloud revenue buoyed by the demand for generative AI.

In April, Microsoft posted revenue of $61.9 billion for the quarter ended March, up 17% year on year, of which $26.7 billion (up 21%) came from its Intelligent Cloud segment, consisting of Azure and other public, private, and hybrid server products and cloud services.

The cloud figure excludes Bing Search and Xbox Cloud Gaming, which are part of its More Personal Computing segment, where revenue rose 17% to $15.6 billion, and Microsoft 365 and Dynamics 365, part of its Productivity and Business Processes segment, where revenue rose 12% to $19.6 billion.

While discussing the quarterly results, CFO Amy Hood said that customers wanted more cloud compute for their AI workloads than the company could supply.

Last month, the company at its annual Build conference released a volley of updates across its Azure offerings to attract developers and CIOs.