60,000 Microsoft Employees Can Take Paychecks and Leave by Year's End

For roughly 60,000 workers at Microsoft, the decision is simple: take a check and walk away, or stay and work through a major corporate shift. The company announced Monday that it is opening a new voluntary exit window for employees in the United States, Canada, India, and the United Kingdom. The offer applies to staff at experience level 70 and below, a threshold that includes many mid-level managers and senior individual contributors.

The scale of the program is substantial. According to a person familiar with the internal details, the initiative covers about 27% of Microsoft’s total workforce of 223,000 people. Employees have until early December to decide whether to accept the package. Those who choose to leave will depart the company on December 31.

Microsoft is making these cuts to manage the cash drain from its aggressive buildout of artificial intelligence infrastructure. The company has been pouring money into data centers to support cloud services for clients like Anthropic and OpenAI. Capital expenditures for the September quarter are expected to top $50 billion, a sharp rise from the $34.9 billion spent in the same quarter last year.

This move follows a year of cost-management measures at the 51-year-old software maker. In April, Microsoft introduced its first-ever voluntary retirement program, which was eligible for about 7% of U.S. employees. Then, in July, the company laid off 4,800 workers. The new buyout extends the reach of these earlier efforts, going higher in the corporate hierarchy to include those at the vice president level, whereas the spring retirement program was limited to senior director level 67 and below.

Amy Coleman, the company’s executive vice president and chief people officer, framed the change as an evolution in how Microsoft handles transitions. “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,” she wrote in a memo to staff. She noted that the plan builds on lessons learned from the earlier retirement program.

The financial stakes are clear. While rivals Alphabet and Amazon reported negative free cash flow in the second quarter, Microsoft still managed to report $19.64 billion in positive free cash flow, though that figure fell 23% year over year. The company is trying to preserve that financial strength while it restructures its business model to charge clients based on AI usage. Some marketing, sales, and engineering teams have already decided to opt out of the new buyout. Microsoft does not have a specific target number of participants in mind, unlike the spring program where more than 30% of eligible staff accepted the offer.

The company is scheduled to report its third-quarter financial results on Wednesday.