
Following last year's layoffs, Microsoft made changes to its hardware lineup which included discontinuing several keyboard models. This decision caused frustration for some dedicated customers. Additionally, Microsoft reduced investment in augmented reality and virtual reality in December by deprecating Windows Mixed Reality, which included tools for running applications in head-mounted displays.

The recent layoffs announced by Microsoft affect some employees who work on mixed reality, which includes virtual and augmented reality. However, the exact number of employees affected within the mixed reality department is not specified in the provided information.

Microsoft remains committed to the Department of Defense's (DoD) Integrated Visual Augmentation System (IVAS) program, despite the reported issues with the HoloLens. The IVAS program utilizes Microsoft's HoloLens technology to develop mixed reality headsets for military use, enhancing situational awareness and capabilities for soldiers.
In response to soldier feedback and testing, Microsoft and the U.S. Army have worked together to improve the IVAS headsets. This collaboration led to the development of the IVAS 1.2 variant, which has shown promising results in addressing the issues soldiers faced with the initial versions, such as nausea and discomfort.
Microsoft's commitment to the IVAS program is demonstrated through their ongoing work on improving the technology and their investment in research and development. The company has also received significant financial support from the DoD, with a contract worth nearly $22 billion for the ongoing production of mixed reality headsets based on the HoloLens technology5.
The IVAS program is a crucial part of the U.S. Army's modernization initiatives, and Microsoft's continued involvement in the project shows their dedication to providing advanced technology to support soldiers in training and combat situations.