Microsoft said Monday that it is offering buyouts to a wide range of employees as it struggles to balance an expensive buildout of artificial intelligence infrastructure with capital efficiency. The software maker announced a new voluntary exit offer for certain workers in the US, Canada, India and the UK with their experience level of 70 or less. About 60,000 people are eligible, according to a person familiar with the matter, who asked not to be identified while an internal matter was discussed. The effort affects about 27% of Microsoft’s total workforce of 223,000 people. Microsoft has been increasing spending on data centers to meet high demand for AI computing, supplying cloud services to Anthropic, OpenAI and many other companies. This put a strain on Microsoft’s finances. In April, it announced a first-ever voluntary retirement program to which about 7% of American employees were eligible. Then in July, Microsoft announced plans to lay off 4,800 employees. “The voluntary departure offer reflects an important part of how we are evolving our approach to change: creating greater flexibility and, where possible, more ways for employees to shape their next chapter,” Amy Coleman, executive vice president and chief people officer at Microsoft, wrote in a memo to employees. “This builds on what we learned earlier this year through the Voluntary Retirement Program.” In the second quarter, Microsoft’s cloud rivals Alphabet and Amazon reported negative free cash flow, but Microsoft showed $19.64 billion in positive free cash flow for the period, down 23% year over year. Some marketing, sales and engineering teams have decided not to participate in the new purchase, the person said. Employees must decide whether to accept the offer in December, and participants will leave on December 31, the person added. More than 30% of those who were able to join the voluntary retirement program continued with it, Microsoft said in July. But that was open to those at the top and bottom director level, while the new initiative goes higher, to the vice president level, the person briefed on the new plan said. The person said Microsoft doesn’t have a goal in mind this time. On Wednesday, Microsoft reports third-quarter results. WATCH: Amazon and Microsoft profits are key to measuring return on investment in AI: CIO
