Microsoft could lay off ‘thousands’ as it focuses more on cloud services

Microsoft reorganized its global sales force today to heighten its focus on selling cloud services instead of standalone pieces of software, according to The Wall Street Journal. The reorganization, just the latest in a series of structural changes the company has undergone since former CEO Steve Ballmer resigned and Satya Nadella took over in 2014, won’t immediately result in layoffs. Yet the WSJ reports that thousands of jobs could be cut down the line as a result of the sales shuffle.

This doesn’t appear like it will have a huge impact on how Microsoft does business on a day-to-day basis. Since the appointment of Nadella, the former head of Microsoft’s cloud division, the company has put more and more resources toward building out its Azure cloud computing platform and selling software subscriptions to businesses. This is all part of a steady shift away from one-time software licenses for products like Windows and Office. Microsoft is still playing catch up against Amazon, with the massive success of its AWS business, and now trying to stave off competition from Google and its growing cloud division.

Microsoft says it will now focus on two distinct areas: big enterprise customers, and then small to medium-sized businesses. It’s not exactly clear what changes are in the pipeline, but an email from Judson Althoff, Microsoft’s executive vice president of worldwide commercial business, says sales reorganization is designed to “align the right resources for the right customer at the right time.” The magnitude of the potential layoffs is unclear, but the WSJ says they will likely occur in offices all around the globe.