Microsoft launches voluntary departure program for 60,000 people, with the Copilot team also covered

Microsoft is starting to pay employees to voluntarily consider leaving.

About 60,000 people are eligible to accept this offer, more than a quarter of the company's global workforce.

This time, employees don't have to wait until they're near retirement, nor are they required to have poor performance. Eligible employees can take the compensation and leave the company at the end of the year. It feels a bit like the company can't wait to shed some people.

Even the Copilot team, which Microsoft has high hopes for, is within the coverage. Think back to this spring, when other departments paused hiring, the Copilot team was still recruiting.

Microsoft is still very profitable, with net profit reaching $133.7 billion in the past fiscal year. But as AI investment expands, the company expects capital expenditures in 2026 to reach about $175 billion, which is why outsiders link this round of departure plans to cost control and freeing up funds for AI investment.

01 Microsoft pays up, asking you to consider leaving

Working at Microsoft, you might now face a multiple-choice question: the company gives you a sum of money—are you willing to resign?

On the evening of October 26 Beijing time, Microsoft launched a new round of voluntary departure plans, with about 60,000 employees in the United States, Canada, the United Kingdom and India eligible to participate.

Based on the 223,000 global employees at the end of June this year, more than a quarter of them can consider taking the money and leaving.

What does 60,000 people mean? Meta's total workforce at the end of last year was less than 80,000, so the number of people covered by Microsoft's departure invitation is equivalent to three-quarters of Meta.

Look at the recent layoff moves of peers. Amazon cut about 30,000 corporate positions in two rounds from the end of last year to the beginning of this year; Meta cut about 8,000 people in May this year.

It is still unknown how many people will ultimately accept Microsoft's invitation, but just looking at the number of eligible people, it already exceeds the total of several rounds of layoffs at these two companies.

The threshold for this layoff invitation has been lowered considerably. Employees do not need to rank at the bottom in performance reviews first, nor do they need to reach a certain age or years of service. Among eligible teams, general managers and some employees with vice president titles can also sign up.

Half a year ago, Microsoft had not expanded the scope this much.

In April this year, the company launched a voluntary retirement plan for the first time, requiring employees' age plus years working at Microsoft to add up to 70, and it was only open to employees at the level of senior director and below in the United States.

For example, a person who is 50 years old and has worked at Microsoft for 20 years would cross this threshold. About 8,750 people were eligible, mainly long-serving employees who had been at the company for many years.

This approach really got takers. About 30% of eligible employees accepted the retirement plan. Microsoft Chief Human Resources Officer Amy Coleman later revealed that this reduced the number of people the company needed to lay off involuntarily in July.

Now, the age and years-of-service requirements have been removed, and the applicable regions and job levels have also been expanded.

So how much money is this exactly?

According to the plan for U.S. employees, compensation is related to job level and years of service. For most employees, the salary compensation cap is about nine months, while the plan for some higher-level employees includes a full year's salary. In addition, there are arrangements such as continued stock vesting within a certain period.

Eligible employees will receive their specific plans and can consider until the first week of December; those who accept will be scheduled to leave at the end of the year. For people who were already planning to change jobs, this may be just the opportunity—the company is willing to pay to help them take this step.

What's troublesome is that refusing this invitation does not mean you won't be laid off later.

In July this year, Microsoft announced 4,800 layoffs, and in September it cut hundreds more. The company has made clear that voluntary departures will not replace involuntary layoffs. Now you can voluntarily take the money and leave, but if you stay, you may still encounter the next round of layoffs. Employees have to make a choice, and it is somewhat of a gamble.

This invitation also touches Microsoft's most valued AI business. In addition to departments such as finance, human resources, Xbox and Windows, Copilot-related employees are also within the coverage.

02 Why is Copilot also on the list?

Just in March this year, when Microsoft froze hiring for some cloud businesses and North American sales teams, the Copilot team was still recruiting.

Copilot's business has indeed taken off. As of the end of June, paid seats for Microsoft 365 Copilot exceeded 30 million, and net seat additions in the quarter were more than double the previous quarter. HSBC committed to purchasing 200,000 seats, while KPMG expanded deployment to more than 276,000 professionals worldwide. When these companies buy AI, they buy it for hundreds of thousands of people at a time.

Of course, behind Copilot's "track record" is Microsoft's tireless promotion.

Microsoft added Copilot to Windows, Office and Edge, using these products' existing huge user bases to promote it and saving the trouble of finding users from scratch. Microsoft also spent money on advertising. According to media reports, in 2025, Copilot's television advertising spending reached about $60 million.

But Copilot is like an awkward case of nepotism, always carrying a bit of an air of "not worthy of its position."

Nadella once had the enterprise version of Copilot help process a public webpage he was browsing in the Edge browser, but it failed to do so. Nadella then sent an unhappy email to the executive in charge of the related business.

In March this year, the company announced the integration of consumer and enterprise Copilot, linking product experience, platform, office applications and model development more closely. In the announcement, Nadella proposed making these products form a simpler, more complete system.

Some Copilot entry points that had previously been added also had to be removed. In the same month, the Windows team announced that it would start with apps such as Snipping Tool, Photos, and Notepad to reduce "unnecessary Copilot entry points."

By September, Microsoft had made an even bigger change.

Before the revamp, when users opened Word to write a report, Copilot helped alongside them. After the revamp, users can generate and edit reports directly in Copilot without opening Word separately. The same goes for Excel spreadsheets and PowerPoint presentations; Microsoft has moved these office tools into Copilot.

Nadella said he wants to make Copilot "the operating system for work." That phrasing is quite ambitious.

On its July earnings call, Microsoft mentioned that increased usage of Microsoft 365 Copilot, combined with the company's continued investment in improving product quality, caused the gross margin of the business segment it belongs to to decline slightly.

03 To invest in AI, big tech companies are all looking for money

Microsoft is actually very good at making money. In fiscal year 2026, which ended at the end of June this year, the company's net profit reached $133.7 billion, up 31% year over year.

But the money it plans to spend is equally staggering. Microsoft expects capital expenditures in 2026 to reach about $175 billion, for infrastructure such as data centers and servers.

Therefore, when interpreting this invitation for 60,000 layoffs, the outside world believes that Microsoft is controlling costs to fund its massive AI investments.

On October 26, Meta announced an equity financing plan of up to $95 billion. The figure was subsequently expanded to $97.5 billion. Under the updated arrangement, the company will proceed with a combined $37.5 billion issuance of common stock and convertible preferred stock, and also plans to raise up to $60 billion later by selling shares.

Before that, Meta had already borrowed a lot of money. In October last year, the company issued $30 billion in bonds, and in April this year it issued another $25 billion, for a total of $55 billion.

A look at Meta's cash flow shows why it is so aggressive.

In the third quarter of this year, Meta's operating activities generated $32.79 billion in cash, but capital expenditures reached $34.91 billion, turning free cash flow negative at $2.12 billion. The company expects full-year capital expenditures this year to reach $135 billion to $145 billion.

Musk is also looking for ways, except this time he used financing leases.

Also on October 26, SpaceX disclosed an arrangement with total principal payments of about $40 billion. A company under Apollo will first buy AI chips and servers, then lease them to SpaceX for use, with each lease lasting more than five years from the delivery of the equipment. The company expects to finalize the deal before the end of the year, and leasing after equipment delivery will begin in the first half of 2027.

In this way, SpaceX can let the financier pay for the equipment first, while it pays in installments over the following years. Computing power needs to be obtained as soon as possible; as for when to pay, it is best to discuss that later.

In addition to raising money externally, big tech companies are also rearranging their internal budgets.

Microsoft's R&D workforce is already shrinking. In fiscal year 2026, the company's product R&D staff fell from 80,000 the previous year to 77,000, a reduction of 3,000. But R&D expenses in the same fiscal year still grew 9% to $35.56 billion. Microsoft explained in its annual report that the expense growth mainly came from investment in computing power, AI talent, and data, and also included charges such as an impairment in the Xbox business.

This also makes "layoffs to save money" somewhat subtle. The company reduced R&D staff, yet the entire R&D department spent more money. Microsoft still needs to continue developing models and improving Copilot; even if some positions are cut, the computing power and talent needed for this work must continue to be invested.

Infrastructure expansion has likewise not stopped. Microsoft disclosed in July that it added 88 data centers in the past fiscal year and plans to roughly double overall capacity within two years. As more equipment goes into operation, the company still needs people to maintain these machine rooms.

So, in the scope of this departure invitation, there is a detail worth noting — the data center team did not participate in this round of the plan.

This article comes from the WeChat public account "Letter AI", author: Xiaojinya, published by 36Kr with authorization.