Microsoft cuts HoloLens Xbox and Surface jobs

Microsoft becomes the latest big tech business to lay off workers due to the pressures of macroeconomic uncertainty and slowing growth. The tech giant confirmed that it will be cutting off jobs in its HoloLens, Surface laptop, and Xbox products. Reports claim that Microsoft will let go of 100 employees from its industrial metaverse unit, almost closing down the team.

CEO Satya Nadella announced earlier during the year that they will be laying off 10,000 workers. According to a notice filed with the Washington state Employment Security Department, this round of layoffs will impact 617 employees. Those who are working at the company’s headquarters in Redmond, Wash., and office in nearby Bellevue, and Issaquah will be affected by the job cuts.

This is in addition to the 878 employees who were notified that they will be losing their jobs earlier. This brings the total number of Microsoft workers who lost their jobs to nearly 1,500 in Seattle alone. Microsoft announced earlier that the layoffs which come under their 10,000 plan will take place between January and the end of March.

Microsoft’s layoffs in HoloLens and the industrial metaverse unit come just a little while after the company launched efforts to expand in the mixed reality sector for enterprise customers. The market for the product was said to be “promising” by industry analysts. However, the uncertain global economy and the drop in revenue growth are affecting the tech giant greatly.

Sharath Srinivasamurthy, associate vice president of research at analyst firm IDC, says that a lot of large tech businesses are making adjustments to balance their numbers. In the current situation, experimental or futuristic technology will be sent to the back seat. Tech businesses are more likely to channel their resources into ventures that are proven or matured, rather than taking the risk of investing in a product that is too futuristic.

Microsoft’s latest quarterly report shows how its cloud demand was waning, with a rise of only 1% in its net income for the second quarter of the fiscal year 2023. Although the company is undergoing a restructuring of its staff to manage finances, they are still committed to the industrial metaverse. Microsoft will be paying more attention to the areas of the industrial metaverse that are the most important for customers, ensuring there is no change in the existing customer support.

Srinivasamurthy says that the metaverse and the supporting ecosystem need to undergo further technological advancement. There is still room for improvement in graphic rendering and form factors of wearables such as augmented reality (AR) and virtual reality (VR) headsets. As reported, the industrial metaverse unit was made to generate software interfaces that operate control systems of electrical power plants, industrial robotics, and transportation networks.