Microsoft reportedly cutting hundreds of jobs in Azure cloud business, affecting telecoms and space teams, as it profits from AI

Microsoft is reportedly cutting hundreds of jobs in its Azure cloud business.

The cuts affect teams including Azure for Operators, Microsoft’s cloud business for telecommunications firms, and Azure Space & Mission Engineering, Business Insider reported.

Cuts in the two teams may affect up to 1,500 people, the report said.

Both teams belong to a unit called Strategic Missions and Technologies (SMT) created in November 2021 to help accelerate key emerging businesses.

Strategic Missions

The SMT unit also includes Microsoft’s US Federal cloud business and Azure Quantum, focused on quantum computing.

The unit is headed by Jason Zander, a longtime Microsoft executive who was previously chief of the overall Azure business.

Large rounds of job cuts have become commonplace in the tech industry in the past two years following massive overhiring in the sector during the Covid-10 pandemic.

Microsoft itself in January 2023 said it planned to cut 10,000 jobs in the early part of that year, and has announced further rounds of cuts since then.

The latest cuts to Microsoft’s cloud staff may reflect changing priorities as it focuses on generative artificial intelligence (AI), a strategy that has seen its stock price rise by about 23 percent over the past year.

Cloud shift

Microsoft has invested billions in ChatGPT developer OpenAI and notably supplies the company’s heavy cloud infrastructure needs through the Azure cloud business.

In March the company poached most of the staff of start-up Inflection AI as it sought to bulk up in-house AI development.

This year Microsoft has been promoting “AI PCs” with chips from the likes of Qualcomm and AMD that are tuned to run workloads from its OpenAI-powered Copilot generative AI while conserving energy and extending battery life.