“As we handle via this era, we’ll proceed to put money into future development whereas sustaining intense give attention to operational excellence and execution self-discipline.” — Amy Hood, Microsoft chief monetary officer, July 2022.
“Given the selection, we favor weenies over shrimp.” — Mike Murray, then Microsoft’s head of human assets, May 1993.
These two feedback from Microsoft leaders are separated by practically three many years and two very totally different types of communication, however the underlying message is identical: lower your expenses when you possibly can, individuals.
A report by the Wall Street Journal this morning says Microsoft is “asking groups throughout the corporate to rein in some worker bills,” equivalent to enterprise journey and gatherings. The report cited, for instance, a latest picnic for one Microsoft workforce the place managers paid for the meals and drinks personally slightly than expensing the price.
Hood’s feedback above got here from the Microsoft’s fiscal fourth-quarter earnings convention name, explaining the corporate’s method to monetary analysts. Individuals inside the corporate say she reiterated the purpose instantly at an inside assembly to begin the fiscal 12 months, asking staff to suppose exhausting earlier than spending Microsoft’s cash.
The report delivered to thoughts the legendary “Shrimp vs. Weenies” memo from Microsoft’s previous.
Quick-forward to mid-2022, and it’s the most recent instance of tech firms trying to rein in bills within the face of financial uncertainty, as they put together for the potential for a recession or monetary downturn.
Microsoft made a round of layoffs to start the fiscal year, and eliminated many of its open positions. As a part of the belt-tightening, the corporate can be reportedly making cutbacks in its Modern Life Experiences (MLX) group.
Earlier than the cutbacks, the corporate added a record 40,000 employees in its most recent fiscal year. One other 11,000 hires are beginning within the first quarter, primarily in cloud engineering, LinkedIn, buyer deployment and business gross sales, Hood informed analysts on the convention name. Past that, nonetheless, development is predicted to sluggish considerably.
Microsoft’s revenue was up 12% in its recent quarter, to $51.9 billion, with income up 2% to $16.6 billion, lacking Wall Avenue’s expectations on each monetary measures.
Hearken to the most recent episode of the GeekWire Podcast beneath for extra on the financial outlook for Microsoft and different massive tech firms.