Microsoft Offers Buyouts to 60,000 Employees in Four Countries
Microsoft is offering voluntary buyouts to about 60,000 employees in the United States, Canada, India and the United Kingdom. The offer covers workers at level…
Microsoft offers buyouts to 60,000 employees across four countries, according to a person familiar with the matter cited by CNBC. The voluntary exit offer covers workers in the United States, Canada, India and the United Kingdom at level 70 or below, and participants are scheduled to leave on Dec. 31.
Employees must decide whether to accept the offer in early December. Microsoft said Monday the program is part of an effort to balance its costly artificial intelligence infrastructure build-out with capital efficiency.
The offer affects about 27% of the company’s total workforce of 223,000, according to the person cited by CNBC. That figure describes eligibility, not how many employees Microsoft expects to leave; the company has no target for participation, the source said.
Microsoft buyouts come amid AI spending push
Microsoft has been expanding data-center spending to meet demand for AI computing and provide cloud services to Anthropic, OpenAI and other companies. The company said in July that capital expenditures for the September quarter should exceed $50 billion. In the same quarter a year earlier, capital spending and finance leases totaled $34.9 billion.
The spending has added pressure to the company’s finances as it reshapes its business model and increasingly seeks to charge customers based on their use of AI. Microsoft has also equipped programmers, sellers and supply-chain workers with AI tools, CNBC reported.
Microsoft reported $19.64 billion in positive free cash flow for the second quarter, down 23% year over year. CNBC said cloud competitors Alphabet and Amazon both reported negative free cash flow in that period.
For employees, the practical consequence is a choice between staying at the company and taking a voluntary exit offer, with a defined decision window and departure date. The offer spans four countries and reaches higher in the organization than Microsoft’s earlier voluntary retirement program, according to the person familiar with the plan.
Some marketing, sales and engineering teams have decided not to participate in the new buyout, the person told CNBC. The source said the offer extends to the vice president level, while the earlier retirement program was open to employees at senior director level and below.
New offer follows earlier workforce changes
Microsoft introduced its first voluntary retirement program earlier this year for a smaller group of U.S. workers. Around 7% of U.S. employees were eligible, the company said in April. In July, Microsoft also announced plans to lay off 4,800 employees.
More than 30% of employees eligible for the voluntary retirement program chose to participate, Microsoft said in July. The company has not set a participation target for the new offer, according to CNBC’s source.
Amy Coleman, Microsoft’s executive vice president and chief people officer, described the program in a memo to employees as a way to give staff more flexibility as the company changes. “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,” Coleman wrote.
Microsoft is scheduled to report third-quarter results on Wednesday, when the company is also expected to provide an update on its spending plans and cloud business, according to the reports.
Employees who accept the offer are scheduled to leave on Dec. 31.
Source: cnbc.com
