Microsoft offers voluntary severance to about 60,000 employees, covering departments including Xbox, Windows, and Copilot

Citing a Microsoft spokesperson, Bloomberg reported that the company will offer voluntary severance packages to approximately 60,000 employees, covering the United States, Canada, India and the United Kingdom, and applying to those at the vice president level and below.

In a memo to employees on Monday, Chief People Officer Amy Coleman said the move is intended to provide a supported transition path for employees "who are considering leaving the company," with benefits comparable to the standard severance package.

Microsoft will report earnings on Wednesday, with the market focused on whether its massive AI investments have begun to generate quantifiable returns. As of press time, Microsoft shares were up 1.1% in Tuesday trading.

Xbox, Windows and other divisions fully participate; data center roles excluded

Citing people familiar with the matter, Bloomberg reported that divisions including Xbox, Windows, Copilot and Finance will fully participate in the program; however, some employee groups are not eligible, including roles focused on data centers, sales, marketing, cybersecurity and quantum computing.

A Microsoft spokesperson said the company expects a significantly lower proportion of employees to accept this offer compared with the voluntary severance program launched in July for employees at retirement age. At that time, more than 30% of the roughly 8,750 eligible employees accepted the offer.

As of the end of June this year, Microsoft's total global headcount stood at 223,000. Since the company began large-scale investment in AI and data center construction around 2022, total headcount has remained essentially at this level, meaning that the continued expansion of AI spending has effectively squeezed hiring and budget space in other areas.

Behind this severance program is a clearer talent strategy orientation.

A Microsoft spokesperson said the company wants to retain employees who are truly committed to tackling key challenges, which is highly consistent with public statements from executives at other tech companies—continued employment means accepting a faster pace of work and requirements for change.

This trend is not isolated in the industry. After Elon Musk acquired Twitter in 2022, he asked employees to choose between "working extremely hardcore" or accepting a severance package. According to reports, earlier this year, a Google executive also told team members that those who failed to "go all in" on AI could opt for a voluntary severance package.

Google's parent company Alphabet rolled out similar programs across multiple divisions last year; Meta Platforms' total headcount has shrunk by more than 20,000 from its peak at the end of 2022. Both companies are among the largest investors in global data center infrastructure.

How employees weigh the decision, and how the company provides a safety net

For employees, whether to accept a voluntary severance package typically involves multiple considerations: their own savings situation, the potential risk of being laid off, the absorptive capacity of the current job market, and whether the compensation can provide enough of a buffer period to achieve a career transition.

Compared with passive layoffs, voluntary severance programs usually offer more generous terms and mostly apply to higher-paid mid- and senior-level employees.

A Microsoft spokesperson added that if some top talent chooses to accept the compensation package, the company will also try to retain them. In the memo, Amy Coleman positioned the program as another tool for business divisions to "adjust workforce structure to adapt to evolving needs."

In recent years, Microsoft has gone through several rounds of large-scale layoffs, cutting tens of thousands of positions in total. This voluntary-oriented compensation program represents the company's push to shift human capital fully toward the AI era in a gentler but equally firm manner. Risk disclosure and disclaimer

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