Team siliconindia

• Microsoft laid off nearly 4% of its global workforce, primarily in engineering, product, and support roles.
• The company reports saving over $500 million through AI-driven efficiencies, especially in call centers and coding.
• AI now handles 35% of Microsoft’s software development tasks, streamlining operations and boosting productivity.

Microsoft has announced it has saved over $500 million in operational costs, primarily through AI-driven efficiencies across its customer service and product development functions just months after laying off nearly 9,000 employees.

According to a Bloomberg report, the AI deployment significantly enhanced productivity in Microsoft’s sales and customer service teams, especially in handling smaller customers. The shift has notably reduced reliance on human-led support, with AI tools now used for 35% of coding tasks by the company’s software engineering team.

Speaking at a recent presentation, Judson Althoff, Chief Commercial Officer at Microsoft, credited AI integration for boosting performance while trimming costs.

The layoffs affecting around 4% of Microsoft's global workforce hit engineering the hardest, with 993 engineers laid off, followed by 412 program managers, 410 product managers, and employees in marketing, design, legal, and support roles. The data comes from Washington state’s Employment Security Department, as reported by The Seattle Times.

The publication noted the shift signals a changing identity for Microsoft, long regarded as the 'gentle tech giant', as it increasingly prioritizes automation and AI-led operations to drive profitability and product delivery.