Microsoft saves half a billion through AI, announced soon after cutting 9,000 jobs

Microsoft’s recent internal announcement shows the company is embracing the efficiencies of AI. Chief Commercial Officer Judson Althoff made it known that in the past year, AI tools have propelled productivity in sales, customer service, and software engineering. Such strides have corroborated Microsoft’s ability to save up to half a billion dollars in one of its call centers.

This information was released just as Microsoft confirmed layoffs of 9,000 workers. The company has seen three rounds of layoffs in the current year, affecting about 15,000 employees in total. The recent mass layoff combined with the announcement of significant AI-induced cost savings has induced mixed reactions among the workforce and the public, with some seeing the move as insensitive.

Irrespective of workforce adjustments, Microsoft posted strong financials in the first quarter, with a whopping $26 billion profit and $70 billion in revenue. The tech behemoth’s market capitalization shot up considerably recently, surpassing Apple with a net value of approximately $3.74 trillion. Microsoft has indicated its intention to funnel a significant part of its profit into AI.

Earlier this year, Microsoft revealed plans to spend $80 billion on AI infrastructure within the next four years. Despite the layoffs, Microsoft continues to recruit, and much of its talent acquisition efforts seem geared towards a growing industry-wide competition - attracting top-tier AI researchers. In essence, the company is much more inclined to spend millions on AI experts than middle managers and other categories of workers at the moment.