Microsoft's reported job cuts & OpenAI beef: What to know

Yahoo

20-06-2025

Microsoft (MSFT) is reportedly planning to cut thousands of jobs, according to Bloomberg.
Yahoo Finance Tech Editor Dan Howley outlines the latest, including how the tech giant's hefty artificial intelligence (AI) spending, notably its multibillion-dollar partnership with OpenAI (OPAI.PVT), could intensify the need to cut costs.
This comes amid reported turmoil between Microsoft and OpenAI. The Wall Street Journal reports that the ChatGPT maker has considered pushing for an antitrust case against its partner, while the Financial Times reports that Microsoft is ready to walk away from the deal.
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Microsoft is reportedly planning to cut thousands of jobs as part of the company's latest move to trim its workforce. Yahoo Finance's Dan Howley here with more on the story. So what are these cuts all about? And they come on the heels of cuts that the company's already been doing, right?
Yeah, thousands of jobs, uh this is according to a Bloomberg report, are kind of up in the air at this point. Microsoft could start to announce the layoffs at the end of its fiscal year, which is coming up. Uh and yet, this comes after they left uh laid off thousands of workers uh earlier in in May. So it it's kind of a a recurring thing for Microsoft at this point where they continue to lay off uh workers every few months. They they say that it's part of uh their kind of right sizing, I guess, is the corporate parlance, uh or, you know, a means of making sure that they can be as dynamic as possible. Uh it it really, I think, comes down to making sure that uh they have uh the people that they want in the right places at the biggest positions of the company, which are at this point, AI and cloud. Uh and so, you know, don't forget they're also spending billions of dollars on their infrastructure build out on the cloud. So I think that's where a lot of uh of this is coming from. But you know, Microsoft isn't the only company that has gone through this where they've laid off workers, uh as a result of, as they see inefficiencies, or things along those lines. Uh Google had big layoffs. Meta had big layoffs. Uh and so, you know, it it seems to be uh this this kind of continuation of those layoffs going forward.
Dan, while you're here, I want your take on another tech headline. What did you make of Sam Altman saying Meta was offering open AI staff I read this twice because I thought I misread this was $100 million bonuses.
Look man, I'd lie. I would lie and be like, "Yeah, I work there. I I know I know Sam." Uh yeah, I mean, this is basically just, you know, their way of trying to catch up, right? Uh they're disappointed with the way that La 4 hasn't really lived up to their own expectations. They've had to push that back, that release back. Uh they have Scale AI now. Or they're you know, they they've put in was it $14.3 billion to get Scale AI. Uh this is a race to see who can get the most talent, the best talent, and beat the the kind of behemoth that is OpenAI still at this point, right? Now, that's not to say that, you know, other companies aren't aren't doing the same thing, or, you know, trying to poach people. $100 million is pretty rich. Um but you know, uh I do
Well and and I don't know that we need to take him literally about one hundred He was saying this in a podcast, right? Even if it's a million dollars, even if it's $5 million, like the point is
I'd still take it.
The point is, is that the war for AI talent has become and and the irony of course, is that AI's going to replace a lot of jobs, but at the same time that it's creating this huge war for talent. I mean, then on the flip side you got the FT now reporting that Microsoft is talking about halting talks with OpenAI, if they can't come together on issues. Now maybe they're just putting out there that out there in order to put pressure on OpenAI. But again, it speaks to this sort of competitive competitiveness around all of these issues, right?
Yeah. And and look, this this report comes out after a prior Wall Street Journal report saying that Microsoft, or OpenAI was willing to uh go the antitrust route, and make an antitrust complaint about Microsoft. So this is a back and forth, uh no love lost between uh the two at the moment. We reached out to Microsoft and OpenAI and we got a statement for Microsoft saying, you know, basically everything's hunky-dory there. You know, they're working together, uh you know, and they they like their relationship. Um but this this idea that Microsoft would be prepared to walk away, I mean, that's just the the the the talks right now, not away from OpenAI. Uh if they do walk away and they can't agree on anything with OpenAI as far as uh the restructuring goes, then OpenAI could lose out on $20 billion in funding from SoftBank. That's a big hit. Um and so, you know, this is kind of a a tightrope that both companies are walking at this point.
Yeah.
Right. Dan Howley, thank you, sir.
Appreciate it.
Hundred million dollar man.