by She Xiaochen

Employees at Wicresoft, a longtime outsourcing partner for Microsoft in China, were abruptly informed of layoffs on April 7, with social media posts showing termination notices widely shared. The cuts affect Microsoft-related teams across Wicresoft’s Shanghai and Wuxi offices, according to staff who spoke to Jiemian News.

Founded in 2002 and headquartered in Shanghai, Wicresoft is partially owned by Microsoft, which holds a 22.32 per cent stake. The company had more than 3,000 employees as of 2023 and is chaired by Tang Jun, a former president of Microsoft China.

Internal emails cited shifting geopolitical and business conditions as the reason for Microsoft’s global restructuring, with related operations in China to be halted from April 8. Employees said those working on Microsoft projects were dismissed with compensation based on the standard N+1 formula. Staff who signed immediately were reportedly offered an extra 2,000 yuan (US$280).

Microsoft, however, denied it is pulling out of China. “Claims that Microsoft is ending operations in China are inaccurate,” a spokesperson told Jiemian News, adding that any questions regarding Wicresoft’s operations should be directed to the company itself. Wicresoft has not responded to requests for comment.

The layoffs follow a smaller round in Wuxi late last year. While that move raised concerns internally, staff said the latest cuts came without warning—some had even received interview invitations or training assignments just before the Qingming Festival holiday.

Internally, employees have linked the move to tightening US data regulations. In February, 2024, the Biden administration signed an executive order to restrict transfers of sensitive personal and government data to foreign entities. Final rules, issued in December, have increased pressure on US companies and their offshore contractors.

While Microsoft is Wicresoft’s most high-profile client, the firm has recently announced new partnerships with companies such as Ctrip and GE Group. According to Caijing, the layoffs are understood to affect nearly 2,000 employees tied to Microsoft’s China operations.

Wicresoft said it would provide transition support, including overseas placement opportunities in Vietnam, Japan and Hungary—markets where the company plans to expand in line with Microsoft’s evolving global strategy.

The timing of the cuts marks a sharp contrast to Wicresoft’s recent growth messaging. In December, the company opened a new East China headquarters in Nanjing. Just four months later, employees were seen leaving its Shanghai office with boxes in hand—an abrupt reversal for a firm still touting expansion just days before.