A Microsoft spokesperson told CNBC that the software giant continues to implement “organizational changes necessary to best position the company for success in a dynamic marketplace.”

Microsoft Corp. (MSFT) reportedly said on Tuesday that it will lay off 3% of its total workforce across geographies and teams in what could be the largest round of job reductions since 2023.

A Microsoft spokesperson told CNBC that the software giant continues to implement “organizational changes necessary to best position the company for success in a dynamic marketplace.”

The report added that the company had 228,000 employees worldwide at the end of June, implying that the layoffs will impact thousands of employees.

In January of this year, Microsoft reportedly indicated that it is slashing a small percentage of its workforce based on performance. “At Microsoft, we focus on high-performance talent,” a Microsoft spokesperson told CNBC in an email. “We are always working on helping people learn and grow. When people are not performing, we take the appropriate action.”

Last month, Microsoft announced its fiscal 2025 third-quarter earnings. Revenue rose 13% year-on-year (YoY) to $70.1 billion, surpassing a Street estimate of $68.44 billion.  Diluted earnings per share came in at $3.46, topping an analyst estimate of $3.22.

Fears of a slowdown in economic growth and uncertainty surrounding trade tensions have driven firms worldwide to take proactive steps to preserve capital and optimize allocation. While some companies have announced layoffs, others have withdrawn their full-year outlook.

On Monday, education technology company Chegg Inc. (CHGG) announced plans to lay off 22% of its workforce, equivalent to 248 members.

Chegg also announced cost-cutting plans, including expense reductions across its business. These include closing physical offices in the U.S. and Canada by the end of the year, limiting upper funnel marketing, reducing new product development efforts, and cutting general and administrative expenses.

Japanese automaker Nissan recently announced 11,000 job reductions and shut seven factories as the firm struggles with weak sales.

Meanwhile, Microsoft shares gained over 7% in 2025 and 8% in the past 12 months.

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