Microsoft Offers 60,000 Employees Buyouts as AI Spending Soars

Key takeaways

• Microsoft offered voluntary buyouts to 60,000 employees
• Microsoft's $175 billion AI spending push fueled cost-cutting efforts
• MSFT stock rose 1.5% following the announcement

Microsoft announced a sweeping voluntary buyout program covering approximately 60,000 employees. This represents more than a quarter of its global workforce. The Oct. 26 announcement was Microsoft's second voluntary exit initiative of 2026 and follows several rounds of layoffs earlier this year.

According toReuters, the program targets eligible employees across the United States, Canada, the United Kingdom and India.

Which Microsoft Employees Are Being Offered Buyouts?

The voluntary exit program covers employees at level 70 and below in several major divisions, including Copilot, AI Experiences, Xbox, Windows + Devices, finance and human resources. However, certain departments, including marketing, commercial business and security, are excluded.

Microsoft Chief People Officer Amy Coleman explained that the initiative provides employees considering opportunities outside the company with financial support while also allowing participating divisions to adjust their staffing needs.

Microsoft Chief People Officer Amy Coleman

Keep in mind that the announcement does not mean Microsoft is laying off 60,000 workers. Instead, eligible employees can decide whether to accept voluntary separation packages.

Microsoft's $175 Billion AI Push Drives Cost-Cutting

The buyout announcement comes as Microsoft prepares to spend approximately $175 billion on capital expenditures during calendar year 2026, with artificial intelligence infrastructure accounting for a big portion of the investment.

The company is actively expanding its data center capacity, purchasing advanced AI chips and developing products like Microsoft Copilot. However, these investments have intensified pressure on Microsoft to prove that its AI strategy can actually deliver sustainable financial returns.

The latest restructuring follows an earlier voluntary retirement initiative that was offered to approximately 9,000 US employees. Microsoft also announced 4,800 job cuts in July, which represented roughly 2.1% of its global workforce.

Microsoft Stock Climbs Ahead of Earnings

Microsoft shares rose approximately 1.5% on Oct. 26, and closed at $532.60 as investors assessed the company's latest cost-cutting measures. The stock's positive performance came ahead of Microsoft's quarterly earnings announcement that is scheduled for Oct. 28.

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Investors will be watching closely for updates on cloud revenue growth, AI infrastructure spending and whether the company's enormous investments are translating into stronger profitability.

The number of employees accepting Microsoft's latest buyout offer is also a major uncertainty, particularly as the company balances workforce reductions with its expanding AI ambitions.