Microsoft offers voluntary exit packages to 60,000 eligible employees, including in India

Microsoft is offering voluntary buyouts to eligible employees across the US, UK, Canada and India as the tech giant reassesses its workforce amid heavy investment in artificial intelligence (AI). The programme reportedly covers around 60,000 employees, but the figure represents those eligible for the offer, not the number expected to leave. The announcement comes ahead of Microsoft’s third-quarter results, scheduled for Wednesday, and follows an earlier voluntary retirement programme rolled out this year.

Reportedly, the buyout programme covers over a quarter of the company’s global workforce. Back in June 2026, the company had said in its filing that it staffs around 2,23,000 full-time employees. Microsoft EVP and chief people officer, Amy Coleman, said in a memo that the buyout program reflects an important part of how the company is evolving its approach to change, which is creating greater flexibility and, where possible, more ways for employees to shape their next chapter.

Microsoft’s voluntary exit program is claimed to be time-limited and available to eligible employees at level 70 and below. Employees are required to decide if they want to take the offer in early December, and those participating will have to leave on December 31. For the uninitiated, level 70 at Microsoft represents senior leadership or a high-level technical tier such as general managers, partners or senior directors, or even distinguished engineers.

According to reports, some organisations within Microsoft are participating in the programme that covers eligible staff from India, Canada, the UK and the US. According to the company, this participation of different organisations within the company is based on each business unit’s priorities, commitments to customers, and workforce needs. According to CNBC, some marketing, sales and engineering teams have decided to stay away from the new buyout programme.

Why is Microsoft offering buyouts?

The company is offering these voluntary buyouts, as it looks to adjust its workforce and manage costs amid massive investments in AI. Microsoft has been spending billions of dollars on data centres and other AI-related infrastructure that is key to meeting the growing demand for AI compute. This, in turn, appears to be putting pressure on the company to strike a balance between its spending and financial discipline.

Instead of straight-up layoffs, buyouts are offering its employees an option to leave Microsoft with financial support and the resources needed to plan their careers ahead.

More than 30 per cent of employees eligible for Microsoft’s voluntary retirement programme accepted the offer, the company said in July. The earlier programme was open to employees at the senior director level and below. The new scheme extends to vice presidents, according to a person familiar with the plan. Microsoft has not set a target for how many employees should accept the latest offer.

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Why do companies, especially big tech, opt for buyouts?

Companies, particularly big tech firms, use buyouts to reduce their workforce while avoiding the disruption and negative publicity linked to mass layoffs. A buyout offers employees a financial package that likely includes weeks of salary and continued benefits in exchange for a voluntary resignation. For tech companies, buyouts also likely help them cut long-term salary costs, simplify workforce restructuring, and redirect resources towards business priorities such as AI.

With AI changing how work is done, companies are increasingly evaluating if their existing roles and skills align with their future goals. The money saved from reducing headcount may also help them fund specialised AI talent, which often comes with heavy paychecks.

Moreover, buyouts can also be less contentious than forced mass layoffs. Such schemes offer employees financial support while potentially reducing the risk of legal disputes, damage to a company’s reputation and lower morale among remaining staff. The company also has greater clarity over the cost of employee exits. However, buyouts come with risks, as companies may lose experienced staff and critical skills, disrupting teams and operations. Employees with shorter tenures may also receive smaller payouts, leaving them with less financial support as they search for new jobs.