Microsoft offers exit packages to 60,000 staff

Microsoft is offering voluntary buyouts to approximately 60,000 employees in the United States, Canada, India, and the United Kingdom. The offer applies to workers at experience level 70 or below, a tier that extends up to the vice president position.

This initiative impacts roughly 27% of the company's total workforce, which stands at 223,000 people. The move comes as the technology firm attempts to manage the financial pressure of building out its artificial intelligence infrastructure.

Microsoft has increased its spending on data centers to meet demand from clients such as Anthropic and OpenAI. Capital expenditures for the September quarter are expected to exceed $50 billion, up from $34.9 billion in the same period last year. This surge in costs has strained the company's finances.

The new exit offer follows earlier workforce adjustments. In April, Microsoft launched a voluntary retirement program available to 7% of U.S. employees. In July, the company announced plans to lay off 4,800 staff members. More than 30% of eligible workers participated in the April retirement program.

Amy Coleman, Microsoft's executive vice president and chief people officer, told employees in a memo that the offer provides flexibility. "This builds on what we learned earlier this year through the Voluntary Retirement Program," Coleman wrote. The company is shifting its business model to charge clients based on actual AI usage.

Some marketing, sales, and engineering teams have opted out of the new buyout, according to a person familiar with the matter. Employees must accept or decline the offer by early December. Those who participate will depart on December 31.

Microsoft reported $19.64 billion in positive free cash flow during the second quarter, a 23% decrease from the previous year. The company is scheduled to release its third-quarter financial results on Wednesday.