Microsoft on Monday offered buyouts to a quarter of its work force, the latest effort by the company to rein in costs as it spends heavily on artificial intelligence.
Only a sliver of the 60,000 employees offered a buyout are expected to take it, the company said.
In a note to staff, Amy Coleman, Microsoft’s chief people officer, wrote that the buyout is part of the company’s efforts to give employees more control over their future and also “meet different business needs while continuing to create opportunities for our own people to grow and contribute.”
The “time-limited, voluntary” program grew out of the company’s first ever buyouts earlier this year, she wrote. In April, Microsoft offered early retirement to 8,600 long-tenured U.S. employees, and about 30 percent accepted the packages and left over the summer. Microsoft said it heard from additional employees who would have taken the buyout if they had been eligible. That informed the company’s decision to create this new, expanded program.
Between 3 and 5 percent of tech industry employees typically accept buyout offers, Microsoft said.
Like its Big Tech peers, Microsoft has been cutting costs to plow money into the A.I. race. The company told investors to expect its capital spending, largely on data centers and the chips to fill them, to total about $190 billion in 2026.
Microsoft has already slightly shrunk its work force even as business has boomed. For several years, the company maintained a flat head count of about 228,000 employees.
But as of June 30, the end of its fiscal year, Microsoft’s work force had edged lower to 223,000 employees. Over that same fiscal year, Microsoft brought in $332 billion in revenue, up 18 percent from the previous year, and profit grew 31 percent to $134 billion.
In July, Microsoft announced it was cutting 4,800 jobs, particularly in its video game division. The company is scheduled to report quarterly results on Wednesday.
Monday’s buyout offer was widespread — available to vice president levels on down — and went to select teams in Canada, India, Britain and the United States. Some teams, such as sales and some in engineering, were excluded.
The terms of the offer were less generous than the retirement buyout, part of why the company thinks fewer people will take it. This new program provides the company’s standard severance package, which includes a minimum of eight weeks base pay, and steps up based on tenure. An employee’s last day would be Dec. 31.
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