Microsoft to offer voluntary buyouts to 60,000 workers after cutting 4,800 jobs

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After cutting 4,800 jobs, Microsoft now targets 60,000 more for voluntary buyouts

Microsoft is rolling out a sweeping new round of workforce reductions, offering voluntary buyouts to as many as 60,000 employees — on top of the 4,800 jobs it cut in a major restructuring in July.

Earlier this year, Microsoft also launched a voluntary retirement program targeting senior employees whose combined age and years of service exceeded 70, primarily affecting workers in their 40s and 50s.

As AI-driven workforce restructuring continues to sweep through the technology sector, analysts say further headcount reductions could spread across major tech companies.

According to the Financial Times and other international media, Microsoft plans to offer voluntary buyouts to up to 60,000 employees to cut costs and fund AI investment. The program would affect roughly 27 percent of the company's global full-time workforce of 223,000 — the largest such move in the company's history.

The buyout offer covers employees below the vice president level working in four countries: the United States, Canada, the United Kingdom and India. Affected divisions include Windows, Copilot, Xbox and the finance department.

Severance terms mirror Microsoft's standard US retirement package. Employees will receive at least 60 days of base pay during a grace period in which they remain on staff, with additional base pay based on tenure and job level.

Workers must decide whether to accept the offer by early December. Those whose applications are approved will leave the company at year's end.

A file image for illustrative purposes. [Created with ChatGPT AI]

The latest workforce reduction is widely seen as an effort to ease the financial burden of a sharp increase in AI infrastructure spending. Industry observers say Microsoft is trying to cut headcount and reduce costs through voluntary departures rather than outright layoffs. The company has planned $175 billion in capital expenditure this year.

Microsoft is among the big tech companies carrying out the most aggressive workforce reductions in response to the AI-driven shift in the market.

In July, Microsoft laid off 4,800 employees in its Xbox gaming division, representing 2.1 percent of its total workforce. In April, the company launched its first-ever voluntary retirement program, targeting veteran employees whose combined age and years of service exceeded 70.

The wave of restructuring at major global technology companies has now extended to the streaming sector.

Netflix, which has dominated the global streaming market, announced this month it would cut 1,000 jobs — about 6 percent of its total workforce — marking its largest round of layoffs since 2022.

Analysts say even the world's leading streaming service could not escape the pressure, as slowing growth became a reality with quarterly sales growth falling to its lowest level in three years.

sjpark@heraldcorp.com