THE CRUNCH
Microsoft is offering voluntary buyouts to around 60,000 employees across the US, UK, Canada and India, the first time it has made such an offer at that scale. It expands greatly on a retirement offer limited to about 9,000 employees earlier this year, which more than 30 percent accepted. The move fits a stated strategy of trimming headcount to keep funding AI infrastructure, echoing Satya Nadella's comment almost two years ago that total people costs would fall while cost per head and GPU per researcher would rise.
The offer is, according to sources familiar with it, practically the same as Microsoft's regular severance terms: cash based on tenure, accelerated stock vesting, some extra subsidised health coverage and several months of career services. What is unusual is the scale. Even a 5 percent acceptance rate would mean roughly 3,000 departures, and eligible employees have until December to decide.
The offer lands amid a sustained squeeze. Microsoft laid off 4,800 employees just months ago, hitting Xbox and commercial sales teams hardest, and its overall headcount has fallen year over year for the first time in a decade, from 228,000 to around 223,000 as of June 30th. Layoffs that once happened annually are now occurring every few months, with rumours of more in November and January.
Not everyone sees the cuts as pure cost-cutting. Merill Fernando, a former Microsoft Entra product manager, argues the company needs fewer people, describing layers of small, siloed organisations with competing priorities. Nadella has acknowledged those internal tensions are real, while insisting that winning in the marketplace, not social cohesion, is the goal.