Microsoft is majorly downsizing in Russia

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Inevitable. Microsoft has confirmed that it is reducing its operations in Russia, in a move that the company says will affect more than 400 employees in the country.

The Redmond based software titan will continue the suspensions of new sales, as well.

Bloomberg has the lowdown on this latest development, where Microsoft is one of the several companies that have reduced their operations in Russia following its invasion of Ukraine. This change, as one would expect, is due to changing economic landscape in the region following the war.

That said, while this is a major decision, it will not likely alter the bottom line of the company all that much. As Microsoft revealed earlier in the year, Russia accounted for less than 1% of its revenue.

Anyway, this is what Microsoft had to say on this:

“As a result of the changes to the economic outlook and the impact on our business in Russia, we have made the decision to significantly scale down our operations in Russia. We will continue to fulfill our existing contractual obligations with Russian customers while the suspension of new sales remains in effect.

We are working closely with impacted employees to ensure they are treated with respect and have our full support during this difficult time.”

Unfortunate for the affected employees, but a natural course of action given how things were going.

It was actually back in March, immediately following the invasion, that Microsoft announced the halting of all new sales of its products in Russia. This means that the company no longer sold Windows, Office, Xbox consoles, Microsoft 365 subscriptions or Azure cloud services to new customers in the country.

That move followed the company banning state sponsored media outlet like Russia Today and Sputnik from the Microsoft Store, as well as reducing the visibility of their content on Bing. Russian organizations were also blocked from the Microsoft ad network, among other things.

The company downsizing in terms of headcount in the country was very much the next step following the downscaling of its operations in Russia.

And while existing contractual obligations will be honored, it’s clear that the firm does not want to invest in Russia until political and economic stability is attained.