Microsoft offers voluntary exit packages to 60,000 staff as AI spending surges

Microsoft tied the timing partly to security worries, citing recent large-scale, coordinated hacking campaigns carried out with the help of AI agents as a sign the industry cannot afford delay. — AFP pic

First Published: Tuesday, 27 Oct 2026 9:19 AM MYT

SAN FRANCISCO, Oct 27 — Microsoft is offering voluntary buyouts to about 60,000 employees, the company said on Monday, roughly a quarter of its workforce, as the tech giant seeks to cut costs while pouring money into artificial intelligence.

Staff on select teams in the United States, Canada, India and Britain at vice president level and below will be eligible, a Microsoft spokesperson said, while some groups of employees, including some working on data centres, sales and marketing, are excluded.

“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,” Amy Coleman, an executive vice president and chief people officer, told employees in a memo.

It’s the second voluntary buyout offer that Microsoft has offered employees this year.

In April, the company reportedly offered around seven per cent of its US workforce the option to retire early.

Around 30 per cent of those eligible took the voluntary retirement plan, according to CNBC.

Microsoft had 223,000 employees globally at the end of June, down from 228,000 at the end of 2025, according to regulatory filings.

Around 27 per cent of Microsoft’s workforce is eligible for the new buyout offer.

The company is expected to report quarterly earnings later this week.

Tech layoffs

As major tech giants continue to spend heavily on AI-related investments, concerns persist about the impact of the technology on jobs.

Even industry insiders, such as Anthropic CEO Dario Amodei, have warned of mass job losses.

Netflix will reportedly cut around 6 per cent of its workforce, or 1,000 jobs, US media reported last week.

Auction site eBay laid off 1,000 employees earlier this month, adding to a previous round earlier this year which impacted 800 jobs.

In May, Meta laid off around 10 per cent of its global workforce, impacting around 8,000 employees.

In April, Meta also said it would cancel plans to hire an additional 6,000 people and also shift 7,000 other employees into AI workflow-related roles.

Ride-hailing giant Uber said in September that it would lay off around 10 per cent of its staff, impacting an estimated 3,000 or more employees.

And e-commerce giant Amazon announced 16,000 global job cuts in January.

Microsoft previously cut nearly 5,000 jobs in July that heavily targeted its Xbox gaming division.

Amazon, Microsoft, Alphabet and Meta are collectively on track to pour roughly US$700 billion (RM2.86 trillion) into AI data centres, chips and computing infrastructure this year alone.

In July, Microsoft said it spent US$41 billion overall between April and June and expected to increase its spending to US$50 billion between July and September.

However, the company also adjusted its forecast for total spending in the 2026 calendar year to US$175 billion, down from US$190 billion previously.

Around two-thirds of its spending goes towards “short-lived assets,” specifically chips, due to customer demand for “both AI and non-AI infrastructure,” CFO Amy Hood said during a call with analysts. — AFP