Microsoft will hire again: Satya Nadella says new workforce will have 'more leverage than pre-AI'

After months of layoffs and organisational restructuring, Microsoft CEO Satya Nadella has confirmed that the company is ready to expand its workforce again — this time with artificial intelligence at the centre of its growth strategy.

Microsoft’s next phase of hiring will look different from its pre-AI expansion years, with a sharper focus on efficiency and technology-driven growth. “I will say we will grow our headcount, but the way I look at it is that headcount we grow will grow with a lot more leverage than the headcount we had pre-AI,” Nadella said in a podcast with investor Brad Gerstner.

Microsoft ended its 2025 fiscal year in June with around 228,000 employees, roughly the same as a year earlier, after multiple rounds of layoffs that cut more than 15,000 positions across divisions. Nadella explained that these reductions were part of a broader shift as Microsoft redirected resources toward AI infrastructure, partnerships, and products such as Microsoft 365 Copilot and GitHub Copilot — powered by models from OpenAI and Anthropic.

“It’s the unlearning and learning process that I think will take the next year or so, then the headcount growth will come with max leverage,” he said.

Nadella described how AI is already transforming daily operations inside Microsoft. “Right now, any planning, any execution, starts with AI. You research with AI, you think with AI, you share with your colleagues, and what have you,” he said. He cited an example of an executive managing Microsoft’s fibre network who used AI agents to automate maintenance tasks when hiring lagged behind expanding data centre needs. “That is an example of you, to your point, a team with AI tools being able to get more productivity,” Nadella added.

Drawing a parallel with past workplace revolutions, Nadella likened the current AI shift to the adoption of tools like email and Excel that replaced faxes decades ago. “Decades ago, teams would send inter-office memos by fax before email and Excel changed everything,” he recalled. “Now we’re at that same kind of inflection point, only faster.” He said the company wants every employee to learn how to work alongside AI systems and use them to amplify output. “We will grow our headcount,” he said. “But the way I look at it is, that headcount will grow with a lot more leverage than what we had pre-AI.”

Microsoft continues to double down on artificial intelligence across its products. About 230,000 organisations now use Copilot Studio, and more than 14,000 customers are connected to Azure AI Foundry. Financially, the company remains strong. 

It reported $281.7 billion in revenue and $101.8 billion in profit for the fiscal year that ended on June 30, 2025. Azure, its cloud division, grew 34 percent year-over-year to surpass $75 billion in revenue. Microsoft now operates in 70 regions with more than 400 data centres worldwide.

While Microsoft gears up for growth, rivals are taking a different path. Amazon, for instance, recently laid off 14,000 corporate employees. Amazon’s HR head Beth Galetti called AI “the most transformative technology since the Internet,” reflecting the broader reorganisation under way across major tech firms.

Nadella’s comments indicate Microsoft has entered a new phase — one defined not by mass hiring, but by AI-driven efficiency. “It’s the unlearning and learning process that will take the next year or so,” he said. “Then the headcount growth will come, with maximum leverage.”

In Nadella’s words, Microsoft’s next generation of employees won’t just use AI — they’ll build, train, and think with it.