Microsoft Stock: Cost-Cutting Amid AI Investment Push

Microsoft's recent corporate strategy appears contradictory at first glance: while heavily investing in artificial intelligence technologies, the company continues to implement significant workforce reductions. Over 300 employees received termination notices Monday, following last month's announcement of 6,000 job cuts. This comes after 10,000 positions were eliminated in January 2023, including staff working on hardware projects like the HoloLens. Despite these reductions, Microsoft maintained approximately 228,000 employees as of June 2024.

Strategic Realignment Toward AI Growth

The tech giant is reallocating resources to prioritize its artificial intelligence initiatives, particularly through its Azure cloud services. This strategic pivot is evidenced by substantial investments, including a recently announced $400 million expansion of cloud and AI capabilities in Switzerland, upgrading data centers in Geneva and Zurich. Additionally, Microsoft has deepened its partnership with energy company Uniper, aiming to integrate AI throughout Uniper's business operations from energy trading to maintenance optimization. A dedicated AI laboratory will be established at Uniper's Düsseldorf location to facilitate this collaboration. Market response to these developments has been measured, with Microsoft shares trading around $461 on NASDAQ following the announcement.

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Source StockWorld