Microsoft offers voluntary buyouts to 60,000 employees

Microsoft said Monday that it is offering voluntary buyouts to certain employees in the U.S., Canada, India and the United Kingdom. Around 60,000 people are eligible, according to a person familiar with the matter. That is about 27 percent of Microsoft's total workforce of 223,000 people, CNBC reported. The offer is open to workers at the vice president level and below.

The program, called the Voluntary Exit Offer, gives eligible staff members “the opportunity to leave Microsoft with financial support and career planning resources,” Amy Coleman, Microsoft's chief people officer, wrote in a memo to employees. Employees must decide whether to accept the offer by early December, and those who participate will leave on Dec. 31, a person familiar with the matter told CNBC.

Eligibility varies by team. People familiar with the situation told The Verge that staff across Microsoft's AI experiences, Copilot, CoreAI, Windows + Devices, Xbox, finance, and human resources teams are eligible. Cloud + AI, MicrosoftAI, and corporate, external and legal affairs teams are partially participating, while marketing, commercial business, discovery and quantum, and security teams are not, those sources said. A person briefed on the plan told CNBC that some marketing, sales and engineering teams have decided not to participate. Engadget reported that teams working on data centers are not eligible. Microsoft's internal HR site, seen by The Verge, says the offer is not based on age, length of service, or performance, and that the company may consider a future voluntary exit offer “where there is a business and workforce need”.

The buyout follows earlier workforce moves. In July, Microsoft laid off 4,800 employees, primarily in Xbox and commercial sales. Earlier this year, the company offered a voluntary retirement program to around 9,000 U.S. employees whose age plus years of service totaled 70 or more; Microsoft said in July that more than 30 percent of eligible employees accepted that offer. The new offer goes up to the vice president level, and Microsoft has no target for how many people will accept, according to CNBC's source.

The company is balancing a costly artificial intelligence infrastructure build-out with capital efficiency, CNBC reported. Microsoft has been spending heavily on data centers to meet AI demand, with capital expenditures for the September quarter expected to exceed $50 billion, up from $34.9 billion a year earlier. Engadget notes that Microsoft has opened nearly 90 hyperscale data centers this year and has set aside billions for AI infrastructure. The buyouts are part of a broader effort to cut costs and retool its workforce for the AI era, Engadget said.

“The Voluntary Exit Offer reflects an important part of how we're evolving our approach to change: creating greater flexibility and, where possible, more ways for employees to shape their next chapter,” Coleman wrote. Microsoft is scheduled to report third-quarter results on Wednesday.