Microsoft Announces One-Time Performance Bonuses for Employees Following Layoffs, Up to 25% of Annual Bonus

In the night of the announcement, Microsoft released its fiscal fourth-quarter earnings for the year ending June 30, 2024, boasting a revenue of $64.7billion—a$56.2 billion reported in the fourth quarter of the 2023 fiscal year.

Microsoft's net profit for the quarter was $22 billion, up 10% from $20.1 billion in the same period last year. Both revenue and net profit exceeded analysts' expectations.

Despite a decline in Microsoft's stock price last night, due to the actual 29% growth in Microsoft Azure and other cloud services revenues falling short of analysts' expectations of 31%, the company has seen a significant 26% increase in its stock price over the past year. This surge has propelled Microsoft ahead of Apple to become the world's highest-valued company, reflecting an overall positive performance.

In light of these achievements, Microsoft has decided to offer its employees one-time performance bonuses. These bonuses, covering both regular staff and senior executives, will provide up to 25% of the annual bonus for regular employees and up to 10% for senior executives, all paid in cash.

This one-time incentive is separate from Microsoft's standard annual performance bonuses, ensuring employees can still look forward to their end-of-year rewards. The initiative is part of Microsoft's strategy to motivate its workforce.

Following significant job cuts and employee layoffs over the past two years, which have substantially reduced salary expenses, Microsoft is keen to offer competitive compensation to retain and attract talent. These one-time bonuses, while not affecting the financial statements negatively, serve as a cash incentive to encourage employees to stay and contribute to Microsoft's ongoing success, benefitting both the company and its workforce.