Microsoft is reporting massive productivity gains and internal cost savings thanks to its aggressive push into AI — but the timing of the announcement is raising eyebrows. According to Bloomberg, Microsoft’s Chief Commercial Officer Judson Althoff revealed that the company saved over $500 million last year in its call center operations alone through AI tools.
The comments come just days after Microsoft laid off more than 9,000 employees, the third major round of cuts this year, bringing total job losses in 2024 to around 15,000. The juxtaposition — deep layoffs amid record profits and AI-driven efficiencies — is not sitting well with many.
Microsoft’s AI-fueled cost savings are being seen internally across sales, customer service, and software engineering, according to Althoff. Externally, however, some former employees are viewing these gains as cold comfort after being let go from one of the world’s richest companies.
Criticism intensified last week when a now-deleted LinkedIn post from Xbox Game Studios producer Matt Turnbull suggested that laid-off workers overwhelmed by the news could lean on AI tools like Copilot and ChatGPT for emotional support and job-search help. The post was widely seen as insensitive, given the context.
To further complicate things, Microsoft is thriving financially. It ended Q1 with $26 billion in profit and $70 billion in revenue. The company’s market cap has soared to $3.74 trillion, outpacing Apple and trailing only Nvidia. Yet, while shedding thousands of jobs, Microsoft has pledged to invest $80 billion in AI infrastructure in 2025 alone.
The optics are stark: layoffs and AI-fueled automation on one hand, unprecedented investment in AI research and high salaries for elite technical talent on the other. Whether Microsoft is replacing workers with AI or merely "right-sizing" post-COVID remains unclear. What is clear is this: for many recently laid-off employees, hearing about half-billion-dollar savings may sting more than impress.
Related News