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Morgan Stanley cuts 2,500 jobs amid record revenue but the reason is not AI
The Morgan Stanley layoffs are based on strategy and individual performance, and the bank intends to add headcount in other areas.
Morgan Stanley has effected layoffs to cut about 3% of its workforce, or roughly 2,500 employees, despite a record year for revenue.
The job cuts were across the bank's three major divisions: investment banking and trading, wealth management, and investment management, but do not affect its financial advisors, WSJ reported. The Morgan Stanley layoffs are based on strategy and individual performance, and the bank intends to add headcount in other areas.
As on 31 December 2025, Morgan Stanley had 82,992 employees.
The Morgan Stanley layoffs come against the backdrop of a record year for revenues the US-based investment bank. It also beat Wall Street estimates for fourth-quarter profit in January, fueled by a 47% jump in investment banking revenue as dealmaking surged and debt underwriting fees nearly doubled.
Banking executives had struck an optimistic tone for 2026 on the back of healthy pipelines for M&A deals as well as IPOs.
Meanwhile, volatile markets amid worries of AI disruption to legacy technology businesses and geopolitical turmoil continue to boost trading desks as clients reposition portfolios to hedge against risks.
There have been massive layoffs across US companies since the start of this year, as they streamline operations amid rising adoption of AI tools.
