Microsoft is enforcing a mandatory usage of its internal AI tools across all levels of the company. In an internal email, Julia Liuson, president of the Developer Division, stated that AI has become a core part of the company's work culture. With this move, Microsoft is aiming to boost the adoption of its AI services, which have fallen short of internal expectations despite heavy promotion. Managers are now required to evaluate employees based on how effectively they use AI tools in their roles, signaling a shift towards incorporating AI as a key factor in performance assessments.

This move follows increasing competition from other AI platforms like Replit and Cursor. Microsoft's push to increase the internal use of its AI tools, such as Copilot, reflects a larger strategy to stay ahead in the rapidly developing AI sector. As a result, employees are expected to leverage these tools daily, with performance reviews considering AI usage as part of the overall assessment.

Simultaneously, Microsoft is preparing for another round of job cuts, particularly in the Xbox division, which is undergoing a restructuring process. These layoffs come after the company’s acquisition of Activision Blizzard in 2023 and several previous rounds of cuts affecting over 6,300 positions. With gaming operations under financial scrutiny, Microsoft’s internal restructuring is expected to continue, with thousands of roles in the Xbox division likely to be eliminated in the coming weeks. The company has already shut down several game studios and is working towards enhancing profitability through streamlining efforts.