Microsoft Offers Buyouts To 60,000 Employees As AI Spending Hits $175bn

Microsoft has offered voluntary buyouts to about 60,000 employees across selected teams as the technology giant seeks to control costs while expanding its investments in artificial intelligence (AI).

The programme, announced on Monday, is open to eligible employees at level 70 and below in participating teams across Canada, India, the United Kingdom and the United States.

The proposed buyouts represent more than a quarter of Microsoft’s global workforce, which stood at 223,000 full-time employees as of June 30, 2026, according to the company’s annual filing.

Microsoft described the initiative as a time-limited, voluntary programme, with eligible employees expected to receive details shortly after the announcement.

According to a source familiar with the matter, the offer covers several business units, including AI experiences, Copilot, finance, human resources, Xbox, and Windows + Devices.

However, employees in marketing, commercial business and security are excluded from the programme.

In a memo to staff, Microsoft’s Chief People Officer, Amy Coleman, said the initiative was intended to support employees considering leaving the company while giving participating teams greater flexibility to adjust their workforce to changing business needs.

“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.

She added that the programme also provided participating organisations with another option for adapting their workforce to evolving operational requirements.

Microsoft said the initiative builds on lessons from an earlier voluntary retirement programme.

AI Investments Drive Cost-Cutting Efforts

The buyout offer comes as Microsoft and other major technology companies commit hundreds of billions of dollars to artificial intelligence infrastructure, including data centres and advanced chips.

Microsoft has forecast capital expenditure of $175 billion for the 2026 calendar year, highlighting the scale of its spending on infrastructure to support AI development and deployment.

The investments have attracted growing scrutiny from investors seeking evidence that the expected returns from AI will justify the substantial financial commitments.

Microsoft is scheduled to release its first-quarter financial results after markets close on Wednesday, providing investors with an update on its performance and spending priorities.

Latest Move Follows Earlier Job Cuts

The voluntary buyout programme follows other workforce-reduction measures introduced by Microsoft in 2026 as the company restructures parts of its operations.

Earlier in the year, the company offered voluntary buyouts to approximately seven per cent of its United States workforce, affecting about 9,000 employees.

In July, Microsoft also announced plans to cut 4,800 jobs, representing approximately 2.1 per cent of its global workforce, as it restructured its Xbox gaming business and considered divesting up to five studios.

The changes were aimed at improving returns from the gaming division following years of substantial investment.

Tech Giants Restructure Amid AI Expansion

Microsoft’s latest move reflects a broader trend across the global technology industry, where companies are reducing or restructuring their workforces while increasing expenditure on artificial intelligence.

Oracle reportedly shed approximately 21,000 employees globally over the preceding year, with its annual report disclosing $1.8 billion in severance payments and restructuring charges.

In May 2026, Meta, the parent company of Facebook, began notifying employees of planned job cuts affecting approximately 8,000 positions as it restructured operations and increased spending on AI infrastructure, research and product development.

The scale of the reductions has extended across the industry. In July 2026, reports indicated that job-cut announcements by the world’s 10 largest technology companies had affected more than 76,000 workers.

Microsoft’s latest offer highlights the growing tension between the technology industry’s push to dominate AI development and the need to manage operating costs.

While the buyouts are voluntary rather than compulsory redundancies, the programme provides the company with another mechanism to adjust staffing levels as it directs more resources towards AI infrastructure and development.

The effectiveness of the strategy will depend partly on whether the company’s expanding AI investments generate sufficient revenue and profits to justify the costs while maintaining its competitiveness in an increasingly crowded market.