Microsoft exec blames Azure layoffs on the ‘AI wave’ in leaked memo

Zander, the former boss of Microsoft’s Azure cloud business, has been running a team called Strategic Missions and Technologies since (SMT). The organization was formed to house what were then Microsoft’s cutting edge initiatives like quantum computing and space technologies. But these days the company is all about investment in AI.

Microsoft on Monday cut as many as 1,500 employees from Zander’s teams, people familiar with the cuts told Business Insider.

In the email, Zander said the company will halt services in preview, such as Azure Operator 5G Core (AO5GC) and Azure Operator Call Protection. The Azure Operator Nexus team will move to the Cloud + AI organizations’ Azure Edge and Platform product line.

“It’s never easy to make these tough decisions, particularly when they affect our colleagues and friends,” Zander wrote. “We’re dedicated to supporting everyone impacted by these changes with respect, dignity, and transparency to fully support them through this transition.”

This is Microsoft’s latest round of cuts that help the company focus more on AI. It also recently reorganized teams under Jared Spataro, its head of “AI at work,” shifting focus to its Copilot AI products and reducing the number of employees working on its Teams chat app, according to an excerpt of an internal memo shared with Business Insider.

Microsoft didn’t respond to requests for comment on Monday.

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