Tech Giants Layoffs: AI & Market Impact

Corporate tech giants like Microsoft, Google, and Amazon are cutting thousands of jobs as AI disruption and economic pressures reshape the industry. Another wave in 2025 sees major players like Microsoft, Google, Amazon and CrowdStrike laying off thousands as part of restructuring efforts.

Reasons for Restructuring

According toMoneycontrol, macroeconomic uncertainty, slowing revenue growth and the growing impact of artificial intelligence on traditional workflows have been identified as contributors to the recent organizational restructuring. About 61,814 tech employees have been laid off this year across 135 tech companies, as per Layoffs.fyi data.

Microsoft Layoffs

Microsoft alone accounted for 6,000 of those jobs — the company’s largest round of layoffs since 2023, according to a CNBC report. The cuts, announced on May 13, involve departments and geographies, affecting nearly 2,000 employees in Washington state alone. Microsoft said the decision is aimed at flattening its management structure and prioritising engineering talent over administrative layers.

As per a Bloomberg analysis, it was found that over 40% of the layoffs in Washington state targeted software engineers. Some of these engineers were reportedly instructed months earlier to increase their reliance on AI tools, only to be replaced by the AI tools which they helped integrate.

Google Layoffs

Google laid off around 200 employees from its global business organization, which handles advertising partnerships and sales as part of its ongoing operational restructuring. Google toldReutersthat it was making a small number of changes across teams “to drive greater collaboration and expand our ability to quickly and effectively serve our customers.” This follows cuts in its Pixel, Android, Chrome and cloud divisions in recent months — all part of an ongoing overhaul of its operating model post-2023’s 12,000-person layoff.

Amazon and Others

Amazon is also back on the layoff list, slashing 100 roles in its Devices and Services division. The unit — which manages Alexa, Kindle, and Zoox — is being streamlined to better align with product goals. Cybersecurity firm CrowdStrike also laid off 5% of its staff in a move it says will sharpen its focus on long-term profitability.

IBM's Approach

IBM CEO Arvind Krishna toldThe Wall Street Journalthat the company has used artificial intelligence to automate tasks previously handled by several hundred human resources employees. IBM laid off several hundred employees but redeployed efficiencies with new hires in programming and sales. This shift shows how the company balances AI-driven automation with growth.

While strategies vary for each tech giant, tech firms consistently prioritise efficiency and adaptability amid AI disruption and economic challenges.