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Microsoft Lays Off Staff as Savings From AI Top $500 Million

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Microsoft is ramping up internal use of artificial intelligence (AI) tools to cut costs and increase productivity, even as the company trims thousands of jobs across departments.

According to Bloomberg, Chief Commercial Officer Judson Althoff told employees in a recent presentation that AI is enhancing productivity across functions, including sales, customer service and software development, according to a person familiar with his remarks.

AI helped Microsoft save more than $500 million last year in its call centers alone and improved both employee and customer satisfaction, the person said.

The company is also using AI to manage interactions with smaller clients — an initiative that is still early-stage but already generating tens of millions of dollars in revenue, according to the same person.

Read more: Microsoft’s Nadella: AI Agents Serve as ‘Chiefs of Staff’

At the same time, Microsoft has announced job cuts of about 15,000 so far this year, with the latest round affecting customer-facing roles such as sales. The layoffs have raised concerns about AI displacing workersa trend echoed across the technology sector.

Salesforce has relegated 30% of its internal work to AI, enabling it to reduce hiring for some positions.

Tech isn’t the only industry facing the potential impact of AI in the workplace. Ford, JPMorgan and other companies have warned of the possibility of deep job cuts as AI continues to advance.

Read more: Microsoft to Cut 3% of Workforce While Reducing Management Layers

Althoff said Microsoft’s AI tools, including its Copilot assistant, could make them more effective salespeople. He said each seller is finding more leads, closing deals quicker and generating 9% more revenue with Copilot’s help.

Microsoft said in April that its GitHub Copilot has 15 million users and noted that AI now generates 35% of the code for new products, helping speed up development.

Other technology companies are making similar moves: Executives at Alphabet and Meta have noted that AI is now responsible for writing substantial amounts of code.

Microsoft declined to comment.

Read more: Microsoft Cuts Nearly 9K Jobs in 2025’s 4th Round of Layoffs

 



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Google is offering all its best Gemini AI features for free, but only long enough to get you hooked

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This week, Samsung Galaxy Unpacked unveiled its latest smartphones, the Galaxy Z Fold 7, Flip 7, and Flip 7 FE, all integrated with Google Gemini AI features. To sweeten the deal for potential customers, Google announced a special offer: six free months of Google AI Pro for those who purchase the new phones. This premium subscription service includes access to the Gemini 2.5 Pro model, the Google Veo 3 AI video generator, two terabytes of cloud storage, and early access to upcoming AI features.

Of course, once those six months are up, you’ll have to pay the standard $20 a month to keep your subscription. But, Google likely believes more than a few people will be happy to pay after they get accustomed to its AI toolkit. The psychology behind this is as simple as free samples at the grocery store. Google isn’t trying to sell you a subscription right now because it thinks you won’t want to give it up just because it isn’t free anymore.



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Technology and Artificial Intelligence in the Garden

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First disclosure – a real person (me) wrote this article, not Artificial Intelligence (AI).  Second disclosure – I am not a technology expert.  In fact, I often say that I was dragged, kicking and screaming, into the computer age, but… It started at a public park.  I was in Albuquerque visiting my daughter and her […]

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4 Artificial Intelligence (AI) Stocks That Could Make You a Millionaire

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