Microsoft shuts down Pakistan office after 25 years amid global restructuring and layoffs

Microsoft has officially shut down its office in Pakistan and laid off five employees, marking a significant development in the country's tech sector, as reported by Dawn. The move, which sparked speculation on social media, was first brought to public attention by a LinkedIn post from Jawad Rehman, the former head of Microsoft Pakistan. Citing insider information, he claimed the tech giant had "officially closed its operations" in the country.

While Microsoft maintained a small on-ground presence in Pakistan until recently, most of its operations were already being managed by foreign offices and local partners, according to Dawn.

Responding to Dawn's queries, a Microsoft spokesperson confirmed the closure, stating, “We will serve our customers through both our strong and extensive partner organisation, and other closely located Microsoft offices. We follow this model successfully in several other countries around the world.”

Microsoft's global restructuring efforts

According to Dawn, the decision is part of Microsoft's global restructuring efforts and broader transition towards artificial intelligence (AI) and Software-as-a-Service (SaaS) business models. Just this week, Microsoft announced a four per cent reduction in its global workforce, amounting to nearly 9,000 job cuts out of 2,28,000 total employees, following earlier layoffs in May.

The Ministry of IT and Telecommunications, in a statement cited by Dawn, clarified that this should not be seen as Microsoft "exiting" Pakistan, but rather a shift to a cloud-based, partner-led model consistent with evolving industry standards.

Technology expert Habibullah Khan explained to Dawn that as companies move from on-premise to SaaS models, physical presence in local markets becomes less necessary. He added that Microsoft's closure in Pakistan is aligned with this shift and is part of a global trend, not a commentary on Pakistan's tech landscape.

Dawn also noted that other multinationals, such as Careem, have recently announced scaling back or ceasing operations in Pakistan, though Khan emphasised Microsoft's move is more about cost-efficiency and strategy, not instability.