Microsoft to offer buyouts to 60,000 employees in India, US, UK and Canada as it restructures workforce for AI
Microsoft Corp. will offer buyouts to around 60,000 employees as the technology giant seeks to reduce costs and restructure its workforce to adapt to the artificial intelligence (AI) era.
The offer will be available to certain employees in the US, Canada, India and the UK at the vice president level and below, a Microsoft spokesperson said.
According to people familiar with the terms, divisions such as Xbox, Windows, Copilot and finance will fully participate in the buyout programme.
However, certain groups of employees will be excluded from the offer. These include some workers involved in data centres, sales, marketing, cybersecurity and quantum computing, the people said. Microsoft declined to comment on these specific details.
In a note to employees on Monday, Chief People Officer Amy Coleman said the programme would give eligible workers an opportunity to leave the company with support.
“This offer gives eligible employees who may be considering a future outside the company a new choice to make that transition now with support,” Coleman said.
A Microsoft spokesperson said employees who accept the offer would receive benefits similar to those provided under a standard severance package.
The latest buyout programme comes as Microsoft has reduced its workforce through multiple rounds of job cuts in recent years.
In July, the company offered buyouts to employees approaching retirement age. More than 30% of the approximately 8,750 employees eligible for that programme accepted the offer.
However, Microsoft expects significantly fewer employees to accept the latest buyout proposal than the voluntary retirement programme, the spokesperson said.
Microsoft’s headcount as of the end of June was 223,000. The figure has been largely flat since 2022, about the time Microsoft began spending heavily on AI and data centers — squeezing budgets and hiring elsewhere in the company.
The company is scheduled to report financial results on Wednesday, and investors will be laser-focused on signs that the heavy spending on AI is paying off. Microsoft shares rose about 1% at midday in New York.
Other companies have sought to shrink headcount as they redirect spending to AI infrastructure. Google offered voluntary buyouts in a number of units last year, CNBC reported. Meta Platforms Inc.’s headcount is down by more than 20,000 from a late 2022 peak. Both are among the biggest spenders on data center infrastructure.
The Microsoft spokesperson said the company wants employees who are engaged on the hard problems it’s trying to solve. That echoes other tech bosses, who’ve publicly made clear that continued employment means embracing a faster pace of work and change.
Elon Musk in 2022 famously gave Twitter employees the choice to be “extremely hardcore,” or take a severance payment. Earlier this year, Business Insider reported that a Google executive told employees in his organization that those who weren’t “all in” on AI could have a voluntary buyout package.
Workers deciding whether to take a buyout typically assess their savings and whether they’re at risk of layoffs later. Midcareer professionals also consider the job market and how long it might take them to find a new role, or whether the package gives them enough runway to make a pivot. Buyouts typically go to more senior, higher-cost staff, as with Microsoft’s round of early retirement offers, and offer more generous terms than a layoff.
In some cases, Microsoft will try to retain top talent if employees opt to take the buyout offer, the spokesperson said.
The buyouts give Microsoft units “another way to adapt their workforce to changing needs,” Coleman wrote in the memo.
(With inputs from Bloomberg)
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