Microsoft racks up over US$500 million in AI savings

Microsoft saved more than US$500 million ($765 million) in its call centres alone last year by using artificial intelligence, Bloomberg News reported.

The tech giant last week announced plans to lay off nearly four percent of its workforce as it looks to rein in costs amid hefty investments in AI infrastructure.

In May, the company had announced layoffs affecting around 6000 workers.

AI tools were helping improve productivity in segments from sales and customer service to software engineering and the company has begun using AI to handle interactions with smaller customers, Microsoft's chief commercial officer Judson Althoff said during a presentation this week, according to the Bloomberg News report.

The nascent effort was already generating tens of millions of dollars, the report said, citing a person familiar with his comments.

AI generated 35 percent of the code for new products, accelerating launch times, Althoff said, according to the report.

Microsoft declined to comment when contacted by Reuters.

The Windows maker has earmarked US$80 billion in capital spending this fiscal year, with most of it aimed at expanding data centres to ease capacity bottlenecks for artificial-intelligence services.

Big tech companies have been spending heavily on AI as they view the new technology as a major growth engine, while slashing costs elsewhere to safeguard profits.