(Bloomberg) -- Some of the largest US technology companies are still bloated even after the recent wave of layoffs aimed at cutting costs. 

That’s the conclusion of strategists at Bank of America after looking at the surge in staffing levels over the past three years at companies like Microsoft Corp. and Amazon.com Inc. compared with revenue. The data suggest that some of the companies are still 20% too big on average, even after the job cuts, according to strategists including Savita Subramanian.

“Sales have historically been the main driver of margins,” the strategists wrote in a research note published on Sunday. “Weakening demand and negative operating leverage suggest to us more margin pressure ahead.”

Technology companies have been cutting costs to shore up profits amid slowing revenue growth as demand that was turbocharged during the Covid-19 pandemic fades. So far, the layoffs have claimed more than 100,000 jobs since 2022.

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