Eligible staff in four countries have until December to decide, as the company weighs AI spending against cost control
Microsoft opened a voluntary exit offer on Monday to about 60,000 employees in the U.S., Canada, India and the United Kingdom, extending a buyout approach the company first tried in April.
The pool equals roughly 27% of Microsoft's 223,000 employees, according to CNBC. It's the company's second voluntary program of 2026.
Amy Coleman, executive vice president and chief people officer at Microsoft in Redmond, Washington, announced the offer in a memo to employees, which the company also published on its official blog.
"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," Coleman wrote. "This builds on what we learned earlier this year through the Voluntary Retirement Program."
What the voluntary exit offer covers
The program is open to eligible employees in participating teams at level 70 and below, Microsoft said. It's time-limited, and the company described it as a way to leave with financial support and career planning resources. The memo doesn't detail the package, and eligible workers were told to expect an email with their individual terms.
Microsoft's memo also doesn't give a headcount. The 60,000 figure comes from news reports.
CNBC's source said employees must decide in December and those who accept will leave on Dec. 31, 2026. Microsoft has no target number this time, the person said. The offer also reaches vice president level, a step above April's cutoff of senior director, according to the same source.
How the offer builds on April's retirement program
April's program was open to about 7% of Microsoft's U.S. workforce, which Computerworld calculated at roughly 8,750 people. More than 30% of those eligible took it, Microsoft said in July. The new offer is far wider, spanning four countries and an eligible pool nearly seven times larger by that count.
July also brought about 4,800 role eliminations, or 2.1% of Microsoft's global workforce. Coleman's memo that month took up the AI question.
"I also want to be direct that the roles eliminated today are not being replaced by AI," Coleman wrote. "At the same time, what is true is that AI is changing how work gets done."
Monday's coverage tied the new offer to cost pressure. CNBC said Microsoft is balancing a costly AI infrastructure buildout with capital efficiency, and reported that the company generated $19.64 billion in free cash flow in the second quarter, down 23% from a year earlier, while Alphabet and Amazon reported negative free cash flow. Agence France-Presse described the move as a way to cut costs while pouring money into AI. Coleman's October memo doesn't mention AI spending or costs. Microsoft reports quarterly earnings on Wednesday.
Microsoft isn't the only large employer reshaping headcount around AI. HRD America reported last week on American Express cutting 5% as it strips out management layers to clear the way for AI and on Barclays cutting 5,000 jobs as it leans on AI to lower costs.
Which teams are in and which aren't
Participation varies. Microsoft said some organizations are offering the program and some aren't, depending on each business's priorities, customer commitments and workforce needs.
A source told Reuters the offer covers divisions including AI experiences, Copilot, finance, human resources, Xbox and Windows + Devices, and excludes marketing, the commercial business and security. Agence France-Presse reported that some groups, including some working on data centers, sales and marketing, are excluded. CNBC's source said some marketing, sales and engineering teams have decided not to take part. Microsoft's memo doesn't say which divisions are involved.
What U.S. employers should check before offering buyouts
Voluntary programs still carry legal obligations. When a U.S. employer offers two or more employees extra consideration to resign and sign a waiver, the U.S. Equal Employment Opportunity Commission (EEOC) treats it as an exit incentive program. For workers 40 and older, the Older Workers Benefit Protection Act sets the terms, according to EEOC guidance on severance waivers.
Under that guidance, the group must get 45 days to consider the waiver and seven days to revoke it after signing. The employer must also disclose in writing the group covered, the eligibility factors, the time limits, and the job titles and ages of those selected and not selected. State laws can add requirements, the EEOC notes. Microsoft's memo doesn't say whether it's seeking waivers.
Involuntary cuts carry their own costs. eBay's deepening layoffs of 1,000 more jobs this year could push severance and related costs as high as $150 million, HRD America reported.
Eligible Microsoft employees have until December to decide.
