In context: In March, Microsoft stopped selling new products in Russia as a result of the invasion of Ukraine. Now, the Windows maker will reportedly lay off over 400 employees from its business in Russia, citing economic conditions in the country as the reason. This news comes a day after IBM's announcement that it's laying off its entire Russia-based workforce.
Microsoft has just announced that it's significantly scaling down its operations in Russia. The move comes after the company suspended all new sales in the country in March due to the ongoing war in Ukraine.
A Microsoft spokesperson claims they made the decision because of changes to the economic outlook and the impact on its business in Russia. The firm also stated that it continues to fulfill its existing contractual obligations with Russian customers while the suspension of new sales remains in effect.
Over 400 employees will reportedly be affected by this move, although it's unknown how many people are currently working for Microsoft in Russia. "We are working closely with impacted employees to ensure they are treated with respect and have our full support during this difficult time", Microsoft said in the statement to Bloomberg News.
During the company's third-quarter earnings call, CFO Amy Hood said that Russia accounts for less than 1 percent of Microsoft's total revenue. She also added that expectations are it will decline significantly.
Just yesterday, we learned that IBM is also starting to lay off personnel in Russia, although it blamed the move on the banking sanctions the country is facing instead. When it comes to technology, it seems that Russia will have to rely more and more on local and Chinese products, as even Taiwan is restricting its exported chips to those under 25 MHz.