Microsoft (Nasdaq: MSFT) announced a one-time voluntary retirement program for eligible US employees — the first in its 51-year history — making roughly 8,750 workers eligible for financial buyouts as the company moves to control costs amid a massive buildout in AI infrastructure.
The program uses a “Rule of 70”: workers at the senior director level and below whose combined age and years of service equal 70 or more qualify. Sales incentive plan employees are excluded. Eligible workers receive details on May 7 and have 30 days to decide. The package includes a financial payout and extended healthcare coverage.
“Our hope is that this program gives those eligible the choice to take that next step on their own terms, with generous company support,” Chief People Officer Amy Coleman wrote in an internal memo reviewed by Bloomberg. Coleman added that she has “never seen the company move with this level of urgency and pace.”
The company cut roughly 15,000 jobs across multiple waves in 2025 — including 9,000 positions last summer — and eliminated more than 27,000 roles globally between 2023 and 2025. CEO Satya Nadella has said Microsoft’s size, at over 220,000 employees globally, is a “massive disadvantage” in the AI race.
Microsoft posted record revenues of $281.7 billion in 2025, up 15% from 2024, with operating income of $128.5 billion. The company invested approximately $88 billion in AI infrastructure that same year.
Related: Meta Announces 8,000 Layoffs on May 20 as AI Investment Surges
Meta (Nasdaq: META) is pursuing similar workforce reductions for the same reason — pouring capital into AI while cutting costs elsewhere. Across tech, companies are replacing traditional roles with AI-native positions in what analysts describe as structural transformation, not cyclical cost-cutting.
Related: CEOs Drop the Euphemisms: AI Is Now Openly Cited as the Reason for Mass Tech Layoffs
Information for this story was found via Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
