Microsoft’s chief commercial officer Judson Althoff said this week that AI tools are driving major productivity gains across sales, customer service, and software engineering, according to Bloomberg. Althoff highlighted that AI has been so effective internally that Microsoft saved over $500 million last year in its call centers alone.

 

These remarks came just a week after Microsoft laid off more than 9,000 employees — its third round of cuts this year, bringing total layoffs to roughly 15,000. Against the backdrop of record profits, those comments could understandably sound tone-deaf to workers who were impacted.

 

The situation was further complicated by a now-deleted LinkedIn post from Matt Turnbull, a producer at Xbox Game Studios, who suggested that employees struggling to process the layoffs could turn to AI tools like ChatGPT and Copilot to manage the cognitive strain of job loss — a suggestion that drew criticism online.

 

It remains unclear whether the recent layoffs were driven by AI replacing roles, or by post-pandemic organizational changes. What is clear is that Microsoft’s record profitability — $26 billion in profit on $70 billion in revenue in Q1 alone — alongside significant workforce reductions presents an uncomfortable juxtaposition. The company’s market cap has climbed to around $3.74 trillion, overtaking Apple and trailing only Nvidia.

 

Microsoft has made clear where it intends to invest next: in January, it announced plans to spend $80 billion on AI infrastructure through 2025. While hiring for certain roles continues, the company’s priority seems increasingly tilted toward competing for top AI researchers — even if that means fewer roles for middle managers and other staff.