Microsoft Corporation (MSFT.US) offers voluntary buyouts to about 60,000 employees: covering more than a quarter of its global workforce, cutting costs to free up room for AI capital expenditure

Microsoft Corporation (MSFT.US) said on Monday it will offer a voluntary separation program to about 60,000 employees, aiming to cut costs, reshape its workforce, and adapt its business layout to the AI era. A Microsoft Corporation spokesperson said eligible employees in the United States, Canada, India, and the United Kingdom can participate in the program, with the eligibility ceiling at vice president level and below. That number exceeds a quarter of its total global workforce. People familiar with the matter said the program covers all employees in departments including Xbox, Windows, Copilot, and Finance; some positions related to data centers, sales, marketing, cybersecurity, and quantum computing are not eligible. Microsoft Corporation declined to comment on those details. Chief People Officer Amy Coleman said in a memo to employees on Monday: "For eligible employees who are already considering leaving the company to start a new career path, this program offers a new option that allows everyone to transition smoothly with support." The spokesperson added that participating employees will receive benefits benchmarked against standard severance packages. As the world's largest software vendor, Microsoft Corporation has reduced headcount in recent years through multiple rounds of layoffs. In July this year, Microsoft Corporation launched a voluntary departure program for employees nearing retirement, and more than 30% of the roughly 8,750 eligible employees chose to accept. A Microsoft Corporation spokesperson expects the acceptance rate for this round of voluntary separation to be far lower than that of the previous voluntary retirement program. As of the end of June, Microsoft Corporation had a total of 223,000 employees. Since 2022, that number has been basically flat, and around 2022 was precisely when Microsoft Corporation began investing heavily in AI and data centerswhich squeezed budgets and prompted the company to tighten hiring in other areas. The company is scheduled to report first-quarter results after the U.S. market close on Wednesday and has forecast capital expenditure of US$175 billion for calendar year 2026. Investors will closely watch for signs of whether its massive AI spending is generating returns. As funds continue to tilt toward AI infrastructure, several tech companies are also streamlining staff. According to reports, Alphabet Inc. Class C (GOOGL.US) launched voluntary departure programs across multiple business units last year; Meta (META.US) has reduced its workforce by more than 20,000 from its peak at the end of 2022. Both companies are also major investors in data center infrastructure. A Microsoft Corporation spokesperson said the company wants to retain employees willing to tackle core challenges. That stance is consistent with the messaging from executives at other tech giants: those who want to stay must adapt to a faster pace of work and constant change. It is reported that Elon Musk once gave Twitter employees a similar two choices in 2022: either deliver an extremely high-intensity work performance or take a severance package and leave. Earlier this year, reports said an Alphabet Inc. Class C executive told employees in their department that those unable to fully commit to the AI business could apply for voluntary separation compensation. When deciding whether to accept a voluntary separation package, employees typically assess their own savings and the risk of future forced layoffs; middle-aged workers also weigh the job market environment, the re-employment cycle, or whether the compensation can support them through a career transition. Voluntary separation programs are generally aimed at more senior, higher-cost employees (as was the case with Microsoft Corporation's earlier early retirement program), and the compensation terms are usually better than those of involuntary layoffs. The spokesperson also mentioned that if core talent applies for voluntary separation, Microsoft Corporation will try to retain them as appropriate. Coleman wrote in the memo that the buyout program provides Microsoft Corporation departments with "another way to adapt the workforce to changing needs."