Microsoft Offers First-Ever Buyout Package to 7% of US Workers

Quick Facts

• Microsoft offers voluntary buyouts to up to 7% of its 125,000 US employees for the first time in company’s 51-year history
• Eligible workers must be senior director level or below with combined age and years of service totaling 70 or higher
• Program launches May 7 as Microsoft spends $150 billion annually on AI infrastructure while struggling with 3% adoption rate for Copilot AI service

Microsoft announced its first voluntary buyout program in company history, targeting up to 8,750 US employees as the tech giant reshapes its workforce for the artificial intelligence era.

The program opens to workers at senior director level and below whose age and years of employment add up to 70 or higher. Employees with sales incentive plans cannot participate. Eligible workers will receive notification May 7 and have 30 days to decide.

“Our hope is that this program gives those eligible the choice to take that next step on their own terms, with generous company support,” wrote Amy Coleman, Microsoft’s executive vice president and chief people officer, in an internal memo.

The buyouts come as Microsoft commits unprecedented resources to AI infrastructure. The company spent $37.5 billion in capital expenditures during the second quarter of 2026, mostly on data center construction. Microsoft now operates at a $150 billion annual capital expenditure run rate.

Despite strong financial performance – $281.7 billion in fiscal 2025 revenue and $100 billion in net income for the first time – Microsoft faces AI adoption challenges. Only 3.3% of its 450 million Microsoft 365 customers use the paid Copilot AI service. The company’s share of the US paid AI subscriber market dropped 39% in six months.

The workforce restructuring reflects broader industry trends. CEO Satya Nadella noted at last year’s Build conference that AI tools now write approximately 30% of Microsoft’s software code.

This voluntary approach contrasts with Microsoft’s recent layoffs. The company cut 15,000 jobs in May and July 2025, following 9,000 cuts the previous summer. The buyout program offers a less disruptive method to reduce headcount while maintaining employee relations.

The announcement coincides with organizational changes including modifications to employee stock distribution policies. Managers no longer must tie stock directly to cash bonuses for annual rewards.

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