Category: 3. Business

Microsoft says it is laying off about 9,000 workers, its second mass layoff in months and its largest in more than two years.

The tech giant began sending out layoff notices Wednesday that hit the company’s Xbox video game business and other divisions.

Among those losing their jobs are 830 workers tied to Microsoft’s headquarters in Redmond, Washington, according to a notice sent to state officials Wednesday.

Microsoft said the cuts will affect multiple teams around the world, including its sales division, part of “organizational changes” needed to succeed in a “dynamic marketplace.” The company won’t say the total number of layoffs except that it was about 4% of the workforce it had a year ago.

READ MORE: Trump’s tariffs would cost U.S. employers $82.3 billion, potentially causing price hikes and layoffs

A memo to gaming division employees Wednesday from Xbox CEO Phil Spencer said the cuts would position the video game business “for enduring success and allow us to focus on strategic growth areas.”

Xbox would “follow Microsoft’s lead in removing layers of management to increase agility and effectiveness,” Spencer wrote.

Microsoft employed 228,000 full-time workers as of June 2024, the last time it reported its annual headcount. Its latest layoffs would cut fewer than 4% of that workforce, according to Microsoft. But it has already had at least three layoffs this year and it’s unlikely that new hiring has matched the amount lost. Either way, a 4% cut would amount to somewhere in the range of 9,000 people.

Until now, this year’s biggest layoff was in May, when Microsoft began laying off about 6,000 workers, nearly 3% of its global workforce and its largest job cuts in more than two years.

The cutbacks come as Microsoft continues to invest huge amounts of money in the data centers, specialized computer chips and other infrastructure needed to advance its AI ambitions. The company anticipated those expenses would cost it about $80 billion in the last fiscal year. Its new fiscal year began Tuesday.

Microsoft just last month cut another 300 workers based out of its Redmond headquarters, on top of nearly 2,000 who lost their jobs in the Puget Sound region in May, most of them in software engineering and product management roles, according to information it sent to Washington state employment officials.

Microsoft’s chief financial officer Amy Hood said on an April earnings call that the company was focused on “building high-performing teams and increasing our agility by reducing layers with fewer managers.”

The company has repeatedly characterized its recent layoffs as part of a push to trim management layers, but the May focus on cutting software engineering jobs has fueled worries about how the company’s own AI code-writing products could reduce the number of people needed for programming work.

Microsoft CEO Satya Nadella said earlier this year that “maybe 20, 30% of the code” for some of Microsoft’s coding projects “are probably all written by software.”

The latest layoffs, however, seemed centered on slower-growing areas of the company’s business, said Wedbush Securities analyst Dan Ives.

“They’re focused more and more on AI, cloud and next-generation Microsoft and really looking to cut costs around Xbox and some of the more legacy areas,” Ives said. “I think they overhired over the years. This is Nadella and team making sure that they’re keeping with efficiency and that’s the name of the game in Wall Street.”

The trimming of the Xbox staff follows Microsoft’s years-long expansion of the business surrounding its gaming console, culminating in 2023 with the $75.4 billion acquisition of Activision Blizzard — the California-based maker of hit franchises like Call of Duty and Candy Crush.

Before that, in a bid to compete with Sony’s PlayStation, it spent $7.5 billion to acquire ZeniMax Media, the parent company of Maryland-based video game publisher Bethesda Softworks.

Many of those game studios, which have locations across North America and Europe, were struggling with the layoffs Wednesday, according to social media posts from employees who announced they were looking for new jobs.

NEW YORK — Sales of Tesla electric cars fell sharply in the last three months as boycotts over Elon Musk’s political views continue to keep buyers away.

The 13% plunge in global sales over a year earlier suggests the damage to Tesla’s brand from Musk’s embrace of U.S. President Donald Trump and far-right European politicians is much deeper, widespread and lasting than some investors had expected. The figures reported by Tesla on Wednesday also signal that its quarterly earnings report due later this month could disappoint as rival electric-vehicle makers pounce on its weakness and steal market share. v

Sales fell to 384,122 in April through June, down from 443,956 in the same three months last year.

During the latest period, Musk formally left the Trump administration as a cost-cutting czar, and hopes rose that sales would recover. The Tesla CEO himself recently said the company was in the midst of a “major rebound” in sales, a statement contradicted by the latest figures.

Still, some parts of the report were encouraging. Sales of the Models 3 and Y totaled 373,728, above the estimate of 356,000 from Wall Street analysts. Tesla shares rose 5% on the news.

“The numbers weren’t as bad as thought with all the analyst forecast cuts we saw over the past week,” said Morningstar’s Seth Goldstein, though he added the report overall showed the company faces big challenges. “The current product lineup is at market saturation and Tesla will need the new affordable vehicle to grow deliveries.”

Musk has promised a cheaper EV model would be coming this year that would boost sales.

It’s not clear yet if Musk’s latest feud with Trump will help lure back buyers who have been angry at the billionaire’s political positions. After Musk once again took to social media to criticize Trump’s budget bill, the president threatened Tuesday to use the power of his office to hurt his companies, including Tesla, pushing its stock down more than 5%.

A June AP-NORC poll showed about half of U.S. adults have an unfavorable opinion of Tesla, including 30% of Republicans.

The new figures come as Tesla is focusing less on new models and more on robots, self-driving technology and robotaxis ferrying passengers around without anyone behind the wheel.

Tesla is in the midst of a test run of robotaxis in Austin, Texas, that seems to have gone smoothly for the most part. But it also has drawn the scrutiny of federal car safety regulators because of a few mishaps, including one case in which a Tesla cab was shown on a video heading down an opposing lane.

The competition from rival EV makers is especially fierce in Europe where China’s BYD has taken a bite out of its market share. Tesla sales fell 28% in May in 30 European countries even as the overall market for electric vehicles expanded sharply, according to the European Automobile Manufacturers’ Association.

Musk has acknowledged that his work as head of the Department of Government Efficiency and his embrace of European far-right candidates have hurt the company. But he said earlier this year that much of the sales plunge is due to customers holding off while they waited for an ugrade to Tesla’s best selling Model Y. That new version has been out for months now.

Tesla reports second quarter financial results on July 23. In the first quarter, net income fell 71%.

The FDA has granted accelerated approval to sunvozertinib (Zegfrovy) for the treatment of adult patients with locally advanced or metastatic non–small cell lung cancer (NSCLC) harboring EGFR exon 20 insertion mutations, as detected by an FDA-approved test, whose disease has progressed on or following platinum-based chemotherapy.¹

The efficacy of the agent was examined in the multinational, open-label WU-KONG1b trial (NCT03974022). Data showed that sunvozertinib elicited an objective response rate of 46% (95% CI, 35%-57%), with a duration of response of 11.1 months (95% CI, 8.2-not evaluable).

About the Trial

WU-KONG1 Part B enrolled patients with locally advanced or metastatic NSCLC with EGFR exon 20 insertion mutations confirmed in tumor tissue.² Patients needed to have an ECOG performance status of 0 or 1 and have received prior treatment with platinum-based chemotherapy.

Patients were randomly assigned 1:1 to receive sunvozertinib at 200 mg daily or 300 mg daily. At the interim analysis, 111 patients went on to receive continuous dosing of the agent at 300 mg daily until trial discontinuation criteria were met.

Independent review committee (IRC)–assessed ORR served as the trial’s primary end point. IRC-assessed duration of response (DOR) was a key secondary end point. Other secondary end points included investigator-assessed ORR and DOR.

Safety Spotlight

The most common grade 3 or higher treatment-related adverse effects (TRAEs) observed with the agent at the 300-mg dose included diarrhea (17.1%), increased blood creatinine phosphokinase levels (10.8%), anemia (3.6%), rash (3.6%), increased lipase levels (3.6%), decreased neutrophil counts (2.7%), hypokalemia (2.7%), decreased appetite (2.7%), and asthenia (2.7%). TRAEs led to dose reduction and treatment discontinuation in 36.0% and 6.3% of patients, respectively. Investigators noted that most of the common TRAEs were grade 1 or 2 in severity and clinically manageable. No TRAEs led to fatal outcomes.

What Came Before

Previously, in April 2024, the FDA granted breakthrough therapy designation to sunvozertinib for patients with treatment-naive NSCLC harboring an EGFR exon 20 insertion mutation.³

References

1. FDA grants accelerated approval to sunvozertinib for metastatic non-small cell lung cancer with EGFR exon 20 insertion mutations. FDA. July 2, 2025. Accessed July 2, 2025. https://www.fda.gov/drugs/resources-information-approved-drugs/fda-grants-accelerated-approval-sunvozertinib-metastatic-non-small-cell-lung-cancer-egfr-exon-20
2. Yang J CH, Doucet L, Wang M, et al. A multinational pivotal study of sunvozertinib in platinum pretreated non-small cell lung cancer with EGFR exon 20 insertion mutations: primary analysis of WU-KONG1 study. J Clin Oncol. 2024;42(suppl 16)8513. doi:10.1200/JCO.2024.42.16_suppl.8513
3. FDA grants breakthrough therapy designation to sunvozertinib for the first-line treatment of patients with advanced non-small cell lung cancer harboring EGFR exon 20 insertion mutations. News Release. Dizal Pharma. April 7, 2024. Accessed July 2, 2025. https://www.dizalpharma.com/news/detail?id=70&search=&currentPage=1

Tesla posted another big drop in quarterly deliveries on Wednesday, putting it on course for its second straight annual sales decline as demand falters due to backlash over CEO Elon Musk’s political stance and an ageing vehicle lineup.

Tesla said it delivered 384,122 vehicles in the second quarter, down 13.5% from 443,956 units a year ago. Analysts had expected it to report deliveries of about 394,378 vehicles, according to an average of 23 estimates from the financial research firm Visible Alpha, though projections went to as low as 360,080 units based on estimates from 10 analysts over the past month. Analysts use the number of vehicles delivered to customers as a metric of success to evaluate both automotive sales and production.

“The market is reacting to the deliveries not being as bad as potentially thought with multiple analysts cutting their forecasts over the past week,” said Seth Goldstein, senior equity analyst at Morningstar.

The stock has lost 25% of its value so far this year as investors feared brand damage in Europe, where sales have slumped most sharply, and in the US from Musk’s embrace of rightwing politics and his role in spearheading the Trump administration’s cost-cutting effort. The day Trump and Musk split publicly in early June, Tesla lost about $150bn in market value. Its share price has somewhat recovered in the ensuing month, but Trump and Musk have likewise reignited their feud as they spar over Trump’s sweeping tax bill.

Tesla’s plummeting deliveries in a steadily growing global EV market come despite Musk saying in April that sales had turned around.

The company refreshed its top-selling Model Y crossover earlier this year to boost demand, but the redesign forced a production halt and prompted some buyers to delay purchases in anticipation of the updated version.

Most of Tesla’s revenue and profit come from its core EV business, and much of its trillion-dollar valuation hangs on Musk’s big bet on converting its vehicles into robotaxis.

Tesla last month rolled out a robotaxi service in limited parts of Austin, Texas, for a select group of invitees and with several restrictions, including having a safety monitor in the front passenger seat. The pilot was limited, though, with only about a dozen Robotaxis on the road. The US National Highway and Transportation Safety Administration opened an investigation into the launch of the autonomous ride service.

The automaker had said it would start producing a cheaper vehicle, expected to be a pared-down Model Y, by June’s end.

While a cheaper model might help bolster sales, Wall Street expects a second consecutive annual sales decline this year. To achieve Musk’s target of returning to growth this year, Tesla would need to hand over more than a million units in the second half – a record and a tough challenge, according to analysts, despite typically stronger sales in the second half.

On June 30, the U.S. Supreme Court agreed to hear a case that will determine whether Section 47(b) of the Investment Company Act of 1940 (ICA) creates a private right of action for shareholders of registered investment companies to bring lawsuits for alleged violations of the statute. The Second Circuit Court of Appeals has recognized such a right of action since 2019, opening a back door to litigation claims by private plaintiffs for alleged ICA violations, despite Congress having granted the Securities and Exchange Commission (SEC) sole regulatory authority to enforce the ICA. Other circuit courts of appeal have rejected a Section 47(b) private right of action. This week, the Supreme Court granted certiorari in FS Credit Opportunities Corp. v. Saba Capital Master Fund, Ltd. to resolve the circuit split. The outcome of the appeal, to be heard in the Court’s October 2025 term, will have broad implications for registered funds governed by the ICA (including mutual funds, exchange-traded funds (ETFs) and closed-end funds), as the litigation door opened by the Second Circuit risks upending the long-established regulatory structure that is the fund industry’s bedrock.

In the ICA, Congress granted fund shareholders a single express private right of action to bring lawsuits – namely, a claim for allegedly excessive advisory fees under Section 36(b), which was added to the statute by amendment in 1970. Applying key Supreme Court precedent from 2000, lower courts have uniformly declined to read into the statutory language implied private rights of action to enforce other ICA provisions. The sole outlier was the Second Circuit’s 2019 decision in Oxford University Bank v. Lansuppe Feeder, LLC, recognizing an implied private right of action under Section 47(b). This provision states that a contract “whose performance involves … a violation of” the ICA cannot be enforced by any party to the contract. The Second Circuit panel concluded in Oxford University Bank that this language implied Congress’ intent to provide a private right of action to sue for “rescission” of a contract involving an alleged violation of another provision of the ICA.

Since Oxford University Bank, so-called “activist” investors like hedge fund manager Saba Capital have repeatedly seized upon Section 47(b) as an entry point to challenge closed-end fund by-laws as violating other provisions of the ICA regarding fund capital structure and board elections. These litigations have been in support of Saba’s closed-end fund “arbitrage strategy” seeking to dismantle such funds to obtain short-term profits at the expense of other shareholders. Tellingly, the SEC has not taken any enforcement action to challenge the bylaws in question as violating the ICA.

But the back door threat posed by a Section 47(b) private right of action extends well beyond the closed-end fund “activist” strategy, as explained in an amicus brief submitted to the Supreme Court by the Investment Company Institute (ICI) and the Asset Management Group of the Securities Industry and Financial Markets Association (SIFMA AMG) in support of Supreme Court review. Because fund management and operations are nearly always fully externalized, virtually every task involved in managing a fund and distributing its shares is undertaken by the fund’s investment adviser or other service providers pursuant to a written agreement with the fund in exchange for a fee. If fund shareholders can assert litigation claims for “rescission” of such service agreements based on alleged violations of other ICA provisions in the “performance” of the contracts (regardless of whether the SEC believes the ICA was violated), the potential litigation theories contrived by the private plaintiffs’ bar are almost limitless in scope.

The consequences of a potential flood of litigation claims by the plaintiffs’ bar via Section 47(b) go beyond wasteful litigation expense. The registered fund industry relies heavily on the stable regulatory framework established through the SEC’s decades of rulemaking, exemptive orders, no-action letters and other guidance. Private litigation claims, in which courts would not necessarily be bound by the SEC’s interpretation of the statute, could risk contradictory interpretation and significant regulatory uncertainty, dampening industry innovations and ultimately harming shareholders. The Supreme Court’s decision in FS Credit Opportunities Corp. could have a significant impact on all facets of the registered fund industry and bears close attention.

Ropes & Gray litigators represented ICI and SIFMA AMG in connection with their amicus brief to the Supreme Court.