Microsoft has entered an exclusive club, becoming only the second company ever to achieve a remarkable $3 trillion market valuation. This milestone was reached shortly after the company laid off 1,900 employees from its gaming divisions. While Microsoft briefly surpassed the $3 trillion mark yesterday, it closed today at $3.01 trillion, or $404.87 per share. The only other company to reach this historic valuation was Apple, accomplishing it in December of the previous year. Since then, Microsoft and Apple have been in a close competition for the title of the most valuable company on Wall Street.
Despite this financial triumph, Microsoft’s recent decision to lay off 1,900 workers from its gaming division has garnered attention. These layoffs are seen as a ripple effect stemming from the company’s $69 billion acquisition of Activision Blizzard last year. A significant number of affected employees came from Activision Blizzard divisions, and Phil Spencer, the head of gaming, described the layoffs as part of a strategy to establish a sustainable cost structure supporting the overall growth of the business. Blizzard Entertainment president Mike Ybarra also announced his departure from the company.
This achievement comes almost a year after Microsoft’s previous round of layoffs, which saw 10,000 employees let go across all divisions, including the gaming sector. In the most recent earnings report released in October 2023, covering the quarter ending September 2023, Microsoft reported $56.5 billion in revenue, marking a 13% year-over-year increase, with Xbox content and services revenue also up by 13%. The company is slated to release its full-year earnings for 2023 in the coming week. Microsoft’s recent stock surge has been fueled by its commitment to artificial intelligence, with numerous new product announcements contributing to substantial stock growth.
