Microsoft offers buyouts, spends on AI
- Microsoft offered buyouts to roughly 7% of its U.S. workforce as it reallocates spending toward AI infrastructure. - The company has previously signalled about $100 billion in AI infrastructure spending across coming fiscal periods. - Microsoft also announced a A$25 billion investment in Australia for digital infrastructure, security and skills to support its AI push. (nytimes.com) (news.microsoft.com)
Microsoft is offering voluntary buyouts to some longtime U.S. employees as it keeps pouring money into artificial intelligence infrastructure. (cnbc.com) The one-time program covers workers at senior director level and below whose age plus years at Microsoft add up to at least 70, according to a memo reported Thursday, April 23. About 7% of Microsoft’s U.S. workforce is eligible, CNBC reported, citing a person familiar with the plan. (cnbc.com) Microsoft had 228,000 employees worldwide as of June 2025, including 125,000 in the United States, so 7% of its U.S. workforce would equal roughly 8,750 people. Eligible employees and their managers are set to receive details on May 7, and workers on sales incentive plans are excluded. (cnbc.com) (techcrunch.com) The backdrop is a company spending heavily on the computing muscle behind AI products. In its January 28 fiscal second-quarter release, Microsoft said cloud gross margin slipped in part because of “continued investments in AI infrastructure and growing AI product usage.” (microsoft.com) Microsoft’s latest quarterly results still showed strong growth: revenue reached $81.3 billion for the quarter ended December 31, 2025, while Azure and other cloud services revenue rose 39%. Chief Executive Satya Nadella said on January 28 that Microsoft had already built an AI business “larger than some of our biggest franchises.” (microsoft.com) The company is also moving cash into physical buildout outside the United States. On April 23, Nadella announced a A$25 billion investment in Australia for digital infrastructure, cyber defense work and AI skills programs through the end of 2029. (news.microsoft.com) Microsoft said the Australia plan will expand Azure AI supercomputing and cloud capacity in-country, extend its Microsoft-ASD Cyber-Shield work with government agencies, and help train three million Australians in AI skills by 2028. The company said the package builds on a A$5 billion Australia investment announced in October 2023. (news.microsoft.com 1) (news.microsoft.com 2) (news.microsoft.com 3) Microsoft is also changing how it pays and reviews employees. The memo reported by CNBC said the company will stop forcing managers to tie stock awards directly to cash bonuses and will cut manager pay choices to five from nine. (cnbc.com) Investors will get a fuller update on April 29, when Microsoft is scheduled to report fiscal third-quarter earnings. For now, the company is shrinking part of its U.S. workforce while expanding the data centers, chips and training programs behind its AI push. (microsoft.com)
