Microsoft CEO Satya Nadella has informed employees via email that the company will not be offering salary increases to full-time workers, in line with its cost reduction efforts due to slower revenue growth and reduced client spending. While maintaining the bonus and stock award budget, Nadella stated that compensation this year will be closer to historical averages and that performance bonuses for top executives will be considerably lower than last year.
Why it matters: CEO Satya Nadella said that economic conditions and an investment in artificial intelligence were driving factors behind the change. This lines up with what other companies have been doing in recent weeks.
- In January, Microsoft said that it would cut 5% of it’s workforce, or around 10,000 jobs.
- Microsoft’s revenue growth has also slowed, and it aims to reduce expenses in response to the changing economic landscape.
- “We are clear that we are helping drive a major platform shift in this new era of Al, and doing so in a dynamic, competitive environment while also facing global macroeconomic uncertainties,” Nadella wrote.
