Tech giants Google and Microsoft are cutting jobs in their cloud divisions as part of reorganization efforts.

Microsoft is expected to lay off hundreds, possibly thousands, of employees in its Azure cloud sector, following previous rounds of layoffs in various divisions.

Google has cut at least 100 positions in its Cloud unit, including recent hires and employees still in the onboarding process.

Both companies cited evolving business priorities and the need to invest in critical areas for long-term success.

Despite strong financial performance, with Microsoft and Google experiencing revenue growth in their cloud sectors, these layoffs reflect broader tech industry trends.

The restructuring aims to focus on AI initiatives and strategic growth areas.

Amazon is also reducing its workforce as part of similar restructuring efforts.

Microsoft shares were down slightly, while Alphabet stock remained stable.

The upcoming monthly jobs report may provide further insights into the U.S. labor market.