Microsoft to Offer Buyout Option to Approximately 7% of US Workforce: Report Suggests

Microsoft Announces Voluntary Retirement Program for Thousands of US Employees

Microsoft is undertaking a large-scale workforce adjustment in the United States, offering voluntary retirement to thousands of its employees. According to a person familiar with the planning, approximately 7% of the company's US workforce will be eligible for the buyouts. This significant undertaking marks a first for Microsoft, with the person stating that the company has never previously undertaken buyouts of this scale.

The one-time retirement program will be open to US employees at the senior director level and below, provided their age and years of service together total at least 70. Employees on sales incentive plans will not be eligible for the scheme. This decision aims to provide eligible workers with the choice to take a next step in their careers on their own terms, with generous company support.

As part of the company's efforts to reduce costs, Microsoft is also revising how it distributes stock-based rewards. Managers will no longer be required to directly link stock grants to cash bonuses. This change is part of the company's broader efforts to trim expenses as it pours billions into building the necessary infrastructure for its artificial intelligence services.

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The company has 125,000 employees in the US as of June 2025, making approximately 8,750 workers eligible for the program, according to a Bloomberg report. The offer was announced to employees on Thursday, with a memo seen by Bloomberg outlining the details of the program. Eligible workers include personnel whose years of service plus their age totals 70 or more, excluding some senior roles or those on sales incentive plans.

Reducing Headcount: A Common Approach in the AI Industry

Microsoft is not alone in its efforts to reduce headcount. Big tech companies such as Oracle Corp. and Meta Platforms Inc. have also undertaken sweeping cuts over the last year. This approach is a common strategy for saving cash as companies pour billions into building the necessary infrastructure for their artificial intelligence services.

Comparison of Layoffs in the AI Industry

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Note: The exact number of layoffs for Oracle Corp. and Meta Platforms Inc. may vary, as the companies have not publicly disclosed the exact figures.