Microsoft Saves $500 Million with AI, Announces Job Cuts

Microsoft Corporation has saved more than $500 million in its call centers over the past year by leveraging artificial intelligence. This cost-saving measure comes as the company plans to lay off nearly 4% of its workforce, equating to approximately 15,000 jobs, as part of efforts to manage expenses amid significant investments in AI infrastructure.

The company has been using AI tools to enhance productivity across various segments, including sales, customer service, and software engineering. AI has also been employed to manage interactions with smaller clients, a nascent initiative that is already generating tens of millions of dollars in revenue.

Microsoft's Chief Commercial Officer, Judson Althoff, noted that AI is responsible for generating 35% of the code for new products, which has accelerated product launch times. Despite the job cuts, Microsoft has earmarked $80 billion in capital spending this fiscal year, primarily aimed at expanding data centers to support its AI services.