I think they know/strongly suspect that the bubble is about to pop. They are trying to drastically cut expenses to better weather the coming economic storm.

Like others said, it looks better next quarter than a bunch of new projects. Short term gain vs long.

But also, their expenses from all that hosting and usage are high. They’ve masked it creatively, but that only works so long.

Maybe they’re trying to make their balance sheet look less catastrophic in the short term (again, at the expense of the long term).

Whatever it is, that will be the underlying theme. Things must look good immediately, at the expense of sustainability.

Microsoft is in the looting-by-executive phase of development, I don't know why. I suspect that they see hard times for the company ahead and are extracting every cent that they can before the hammer falls.

My opinion

Only way I can possibly make sense of it is to put myself in the shoes of a capitalist executive. My job is on the line with AI companies reporting massive losses and an earnings call is coming up. If I don't care about human beings, I can just lay them off and that will reduce headcount expenditure so that earnings looks better after spending massive capex on AI. Not to mention the market rewards such announcements by increasing stock valuations since we're running more lean.

However, such a large amount of layoffs could prove unpredictable for workplace morale.

What if we didn't have to pay most of the benefits we do and allow many of our headcount to choose on their own when to leave? We look better in the public eye, we can have a lead time for a couple months so that this earnings report on Wednesday will look like a massive shift for the year end earnings call when we're looking for more investment. We'll be operating so lean it'll be insane. And anyone who doesn't leave voluntarily we can simply lay off afterwards and it'll be a smaller number of layoffs, which the public already treats as normal operating procedure, weeding out the undesirables.

Let's do it.

New products take a long time to plan, develop, and launch at large companies like Microsoft. Laying off 60k employees is quite a bump in quarterly profits.

thier execs and csuites expect a golden parachute thats why.