This month in AI: Layoffs, agentic tools, and mega acquisitions
From tech giants rolling out new tools designed to speed up development cycles along with billion-dollar mega-deals in AI, YourStory brings a recap of major developments and emerging trends in the sector.
Big tech layoffs, agentic software tools, and billion-dollar acquisitions—AI was the hot topic in the month of May.
The spotlight was on agentic AI, where autonomous agents perform complex tasks independently. Tech giants rolled out new tools designed to speed up development cycles, hardware ambitions were made clear through mega deals, and cracks began to show in traditional workforce structures as companies recalibrated around AI.
YourStory brings a recap of major developments and emerging trends in the sector.
The new AI divide: Speeding software, cautious customers
A decade ago, SaaSBoomi, a community for SaaS founders, rallied a handful of Indian entrepreneurs around one goal: to build world-class software. At this year’s edition in Chennai, that mission felt familiar, yet altered.
“Unlearn the constraints of the past,” said Founder Girish Mathrubootham, as he gave a clarion call to Indian startup founders, whose lexicon encompasses AI, SaaS, and deeptech. For SaaS firms, the end-user has changed.
AI impact: Speech and science
How Iyaso is breaking the silence of stuttering with AI
Viraj Kulkarni still remembers the flavour he hesitated to order as a child. Saying “butterscotch” meant risking an audible block, so he settled for chocolate instead. That small sacrifice stemmed from his struggle with stuttering, a speech disorder that affects an estimated 80 million people around the world.
Years later, Kulkarni set out to address this problem with Iyaso, an AI-driven speech therapy company. Founded in 2023, the startup provides structured and personalised interventions to help users learn, practice, and apply speech therapy techniques in real-world situations—something traditional speech therapy often fails to do.
Google DeepMind’s Manish Gupta on driving scientific innovation with AI
Scientific research has traditionally been a long, painstaking process, often taking years of experimentation and analysis. Manish Gupta, Senior Director of Google DeepMind, says that the timeline is now collapsing down to a few seconds, all thanks to artificial intelligence.
“What once took an entire PhD can now be done in a few seconds,” said Gupta, addressing an audience of developers, technologists, and founders at DevSparks 2025, YourStory's flagship developer summit held in Bengaluru.
All about OpenAI’s U-turn as it walks away from for-profit path
In a major company restructuring overhaul, Sam Altman-led OpenAI said it is abandoning its controversial plan to become a for-profit company owing to the longstanding mounting pressure of lawsuits and critics.
CEO Altman, in an open letter to employees, said that OpenAI's non-profit parent will retain full voting control of the company, and its for-profit arm will convert into a Public Benefit Corporation (PBC).
Meanwhile, OpenAI is also facing legal pressure from estranged co-founder Musk, who is challenging the restructuring in court. Previously Musk had attempted to block the company’s move towards a for-profit model. While a judge dismissed the request, parts of his lawsuit are still ongoing. Musk also made a failed $97.4-billion bid to acquire the nonprofit entity that governs OpenAI.
Agentic AI comes for software
This month, major tech companies leaned primarily into developing agentic software, which is AI systems that can reason, act, and automate software development cycles autonomously.
Amazon is developing new AI-driven coding tool ‘Kiro’: Report
Amazon is working on a new AI-powered coding tool, named Kiro, which is built to speed up software development by generating code in real-time, media reports said. Business Insider, citing an internal document, said the new tool is designed as a web and desktop application built to work with first-party and third-party AI agents.
The tool claims to analyse developer prompts and existing code to auto-generate output and technical documentation and flag potential issues. It also supports a multi-modal interface, allowing developers to input not just text but visual diagrams and other contextual data.
Microsoft bets big on AI agents at Build 2025
Tech behemoth Microsoft introduced dozens of AI tools to assist developers in integrating AI across the entire software development lifecycle.
Launched at Build 2025—Microsoft's annual developers conference—the platforms are designed to build AI agents efficiently, boost scientific discovery, and advance open standards and shared infrastructure and protocols.
Microsoft is building an open, agentic web where AI agents interact, make decisions, and perform tasks for individuals, teams, and companies. The company’s new updates will shape the software development lifecycle with AI.
Google goes all-in on AI at I/O 2025, launches 20 new products
Google introduced over a dozen AI tools and a series of research breakthroughs at its annual I/O developer conference held from May 20–21, 2025, in Mountain View, California.
The tech giant launched Jules, an autonomous coding assistant now available in a public beta. The new AI tool operates by cloning developers' existing repositories into secure Google Cloud virtual machines, allowing it to gain a comprehensive context of projects. Jules works independently in the background to perform various development tasks, including writing tests, building new features, fixing bugs, updating dependency versions, and even generating audio changelogs.
Major AI acquisitions
Salesforce to acquire Informatica in $8B deal
SaaS major Salesforce said it will acquire cloud data management company Informatica in an all-equity deal valued at $8 billion, as the enterprise software giant deepens its push into artificial intelligence.
The company stated the acquisition will strengthen its data infrastructure to support the development and deployment of agentic AI across enterprises. “Together, Salesforce and Informatica will create the most complete, agent-ready data platform in the industry,” said Marc Benioff, Chair and CEO of Salesforce.
OpenAI buys Jony Ive’s AI hardware startup io Products in $6.4B deal
Jony Ive, Co-founder of io Products, and Sam Altman, CEO of OpenAI.
ChatGPT-maker OpenAI has acquired io Products, the AI hardware startup co-founded by former Apple design chief Jony Ive and OpenAI CEO Sam Altman, in a $6.4 billion all-equity deal.
The acquisition is by far OpenAI’s largest to date and signals the AI firm's entry into the AI-enabled consumer hardware market. It already owns 23% of io Products and is paying $5 billion for the remaining stake in the company.
Layoffs in big tech
While companies ramp up investments in AI, several job cuts have followed in the tech sector as roles become redundant or automated.
Around 2,000 software developers hit by Microsoft latest layoffs: Report
Microsoft's latest layoffs have affected a chunk of its software engineering unit, as the company increasingly doubles down on artificial intelligence (AI).
According to the latest filings, Microsoft cut roughly 2,000 roles in Washington state alone, with over 40% involving software developers, reported Bloomberg.
Google slashes 200 roles in global business unit amid AI push
Tech giant Google has laid off around 200 employees from its global business unit as the company continues to focus on artificial intelligence (AI) and cloud services.
The reduction is part of a broader reallocation of resources across parent company Alphabet, reflecting a wider trend in big tech as companies double down on AI development and data centre expansion to meet growing demand. Earlier this year, Meta slashed around 5% of its workforce, affecting around 3,600 employees. The company cited performance-based criteria for these cuts, labeling affected individuals as low performers.
Edited by Kanishk Singh