Microsoft on Monday introduced a Voluntary Exit Offer for eligible employees on participating teams in the US, Canada, India and the UK at level 70 and below, according to a memo from Amy Coleman, the company’s executive vice president and chief people officer.
About 60,000 people are eligible, CNBC reported, citing a person familiar with the matter who asked not to be named while discussing an internal matter. CNBC said that is about 27% of Microsoft’s workforce of 223,000.
What Microsoft said
In the memo, which Microsoft published on its official blog, Coleman described the offer as “a time-limited, voluntary program that gives those who are eligible the opportunity to leave Microsoft with financial support and career planning resources.”
“Some organizations are providing the Voluntary Exit Offer, and some are not. Participation varies based on each business’s priorities, customer commitments and workforce needs,” she wrote. “The Voluntary Exit Offer is new for us. We’ll learn from it.”
Timing and scope
Employees must decide in December, and those who take the offer will leave on Dec. 31, the person told CNBC. The memo does not say which teams are taking part. Some marketing, sales and engineering teams decided not to participate, the person told CNBC. The offer reaches up to the vice president level, and Microsoft does not have a target for how many employees accept, according to the person.
TechCrunch, citing reports from Business Insider and Bloomberg, also reported that the offer covers around 60,000 employees and said benefits would be similar to a standard severance package. TechCrunch said those reports listed employees in data centers, sales and marketing among the groups excluded.
Spending and earlier cuts
CNBC reported that Microsoft has been increasing spending on data centers to meet AI computing demand, supplying cloud services to Anthropic, OpenAI and other companies, and said that has strained the company’s finances. Microsoft reported $19.64 billion in free cash flow in the second quarter, down 23% from a year earlier, according to CNBC.
The new offer follows a voluntary retirement program Microsoft announced in April, which about 7% of US employees were eligible for, and a July plan to lay off 4,800 employees, CNBC reported. Microsoft said in July that more than 30% of those eligible for the retirement program took it, according to CNBC.
Microsoft reports quarterly results on Wednesday.