Microsoft (MSFT) stock dipped on Wednesday alongside reports that the tech giant will cut another 9,000 jobs, or 4% of its 228,000-person workforce. The finer details of these layoffs are unclear, but recent reports suggest that Microsoft will largely target its sales team with this headcount reduction.
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It’s still unknown what’s behind these layoffs, but it wouldn’t be surprising if artificial intelligence was at the core of them. Many companies have started cutting workers as they adopt AI to handle the tasks instead. Microsoft is a big player in the AI space and one of the companies that would largely benefit from automating certain tasks. It has also invested significant funds in AI and can help offset this cost with a smaller workforce.
It also bears mentioning that these aren’t the first Microsoft layoffs in 2025. The company already cut 6,000 jobs in May and made similar reductions in 2024. While AI likely contributed to this, tech companies have also been scaling back their workforces after overhiring during the COVID-19 pandemic.
Microsoft Stock Movement and Analyst Updates
MSFT stock was down 0.38% on Wednesday morning, following a 1.08% drop yesterday. Even so, the shares were still up 17.19% year-to-date and 6.79% over the past 12 months.
The latest coverage of MSFT stock includes two updates from analysts:
- Five-star Bernstein analyst Mark Moerdler reiterated a Buy rating and $540 price target, implying a 9.74% upside.
- Top Morgan Stanley analyst Adam Wood maintained a Buy rating and $530 price target, suggesting a 7.71% upside.
Is Microsoft Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus rating for Microsoft is Strong Buy, based on 30 Buy and four Hold ratings over the past three months. With that comes an average MSFT stock price target of $521.41, representing a potential 5.97% upside for the shares.
