July 11, 2025
The GIST A week after layoffs linked to AI cost, Microsoft pledges $4B to AI education 
Sadie Harley
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Andrew Zinin
lead editor
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Microsoft plans to donate $4 billion worth of cash, technology and training to enhance artificial intelligence education, a substantial bequest as the Redmond, Washington-based software giant aims to make billions more off a technology it expects to be on par with the introduction of electricity.
Microsoft President Brad Smith announced the commitment on July 9 during an event held at the Museum of History & Industry in Seattle.
The $4 billion effort over the next five years will flow through a new organization within the company called Microsoft Elevate, which the company describes as a successor and expansion of the longtime Microsoft Philanthropies team. Elevate will have about 300 employees, with the goal of helping more than 20 million people earn AI credentials.
The tech industry as a whole threw its arms around AI after OpenAI launched a generative chatbot in late 2022 called ChatGPT. The model could spit out answers, essays and seemingly original thoughts from a simple prompt. Since then, tech giants like Microsoft have set to work trying to parlay that technology into something useful enough to incorporate into their products.
The generative AI boom transitioned into agentic AI, artificial "agents" running through rote work and making decisions across the digital landscape on behalf of the user. Microsoft sees a lucrative future with agentic AI.
Microsoft's value is skyrocketing due to its embrace of AI. The company's stock reached a record high of $506.78 per share on Wednesday after a Wall Street analyst from Oppenheimer upgraded the stock to buy based on its AI business. Microsoft was valued at $3.74 trillion on Wednesday, making it the second-most valuable company on earth.
The upskilling Microsoft talks about would teach the world how to use those autonomous AI models in everyday work, no matter the industry.
The company's new initiative is part of a balancing act it's been playing with the emergence of AI.
While Microsoft is touting the efficiencies of the technology and hawking new products, it's been trying to be an optimist amid fears of automation and a tighter labor market.
"There's a north star that guides us at Microsoft," Smith said. "We need to use AI to help us think more, not less."
Competitor Amazon has been more blunt about how workforces could change with more AI implementation. Amazon CEO Andy Jassy said last month that the company's corporate headcount could fall in the next few years due to increased efficiencies driven by AI.
Microsoft is reshaping its own workforce in the AI race, though Smith said Wednesday that AI-induced redundancy was not the "predominant factor" for the layoffs over the past two months that affected 15,000 employees.
It's not about building "machines that replace us," Smith said. The goal, he said, is rather "to build machines that help us do more and do it better."
The company is quick to say that AI is changing how work is done at Microsoft, and that introducing AI skills early will prepare workers for new jobs the technology may introduce. AI is changing the scope of roles across Microsoft, from engineers to sales staff.
Microsoft's heavy investment in AI is a more likely culprit for job losses, rather than the technology's implementation. The company is pushing for efficiency by trimming redundant roles and cutting costs. Microsoft emphasizes it's trying to build agile teams with higher employee-to-manager ratios.
Some of the jobs changed by AI also face the brunt of the cuts. Engineers and program managers were represented the most during each round of layoffs at Microsoft.
"Even more jobs'
Microsoft has committed resources to schools before by introducing computer science to classrooms and helping upskill the future workforce during the tech boom. Wednesday's commitment to training teachers and offering avenues toward AI credentials echoes the company's prior push. But, unlike during the past few decades, tech companies aren't rapidly hiring for the AI age yet.
For decades, Microsoft spent every dollar it could employing people. The company recruited, hired and promoted hundreds of thousands of tech workers over 50 years.
But investment priorities for Microsoft and the rest of the tech industry are shifting to infrastructure, Smith said. Since July 2024, the company has spent $80 billion to build data centers around the globe.
Despite flat hiring for the tech industry lately, Microsoft is bullish on job growth worldwide in the future, especially outside of the tech sector.
"I think we're going to have even more jobs in every part of the economy that make use of AI tools and enhanced AI skills," Smith said. "That's the key thing."
2025 The Seattle Times. Distributed by Tribune Content Agency, LLC.
Citation: A week after layoffs linked to AI cost, Microsoft pledges $4B to AI education (2025, July 11) retrieved 11 July 2025 from https://techxplore.com/news/2025-07-week-layoffs-linked-ai-microsoft.html This document is subject to copyright. Apart from any fair dealing for the purpose of private study or research, no part may be reproduced without the written permission. The content is provided for information purposes only.
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