Microsoft (Nasdaq: MSFT) has offered about 60,000 employees the chance to leave with financial support under a Voluntary Exit Offer announced on October 26, the company told Business Insider and GeekWire. The figure is about 27% of the 223,000 full-time employees Microsoft reported at June 30 in its latest annual report, by SaasBuzz’s calculation.
Amy Coleman, executive vice president and chief people officer, announced it in a memo Microsoft published on its blog. The offer is the company’s second voluntary program of 2026, after a US retirement offer in the spring. Amy Hood, the chief financial officer, said on the October 28 earnings call that December-quarter cost guidance includes an estimate for it, but gave no figure.
Who can take it, and on what terms
The memo limits the offer to “eligible employees in participating teams in Canada, India, the United Kingdom and the United States at level 70 and below.” Coleman called it “a time-limited, voluntary program” with “financial support and career planning resources,” and wrote that “some organizations are providing the Voluntary Exit Offer, and some are not.”
GeekWire reported that level 70 “includes general managers and some employees with vice president titles, but not corporate vice presidents,” and that the company said age, tenure, and performance play no part. The sales organization and some engineering and corporate teams are not participating, GeekWire and Business Insider reported. Xbox, Windows, Copilot, and finance teams are taking part, TechCrunch reported, citing Bloomberg.
The memo gives no figures. Microsoft told Business Insider the terms will be similar to its standard severance, and a spokesperson said the standard package varies by market, KUOW reported. According to GeekWire, the package includes base pay tied to tenure and level, ongoing stock vesting, a fixed period of health coverage, and career transition help, but not the retirement program’s extended healthcare.
In the US, Business Insider reported, severance in Microsoft’s layoffs earlier this year kept employees on the payroll for at least 60 days of base pay, and most could get as much as 39 weeks of base pay, depending on seniority and tenure.
Employees have until early December to decide and would leave at year end, a spokesperson told Business Insider; CNBC, citing a person familiar with the matter, put the date at December 31.
The Voluntary Exit Offer is new for us. We’ll learn from it.Amy Coleman, Microsoft’s chief people officer, in the memo
What Microsoft says it is for
Coleman wrote that the offer gives eligible employees “who may be considering a future outside the company a new choice to make that transition now with support,” and gives participating organizations “another way to adapt their workforce to changing needs.”
Microsoft said the offer is not a sign it needs fewer people and does not replace layoffs, which remain part of its approach depending on business conditions, GeekWire reported. A spokesperson said artificial intelligence is not driving the programs, according to KUOW.
Microsoft expects a much smaller share to accept than took the retirement offer, it told GeekWire, and a spokesperson said similar programs elsewhere saw closer to 5% to 6% of employees leave, KIRO 7 reported. There are no plans for another such offer at this time, a spokesperson told Business Insider.
Microsoft’s workforce moves in 2026
Date | What happened | Source |
|---|---|---|
April 23 | Voluntary Retirement Program: US staff up to level 67, if age and years at Microsoft add up to at least 70 | |
April 29 | Roughly $900M of one-time program costs in guidance for the June quarter | |
June 30 | 223,000 full-time employees, down from 228,000 a year earlier | 10-K filings, 2025 and 2026 |
July 6 | About 4,800 roles eliminated, about 2.1% of the workforce; more than 30% of those eligible took the retirement offer | |
July 29 | Retirement program costs lower than expected; headcount down 2% from a year earlier | |
September 22 | Fewer than 600 more roles cut worldwide, the company said | |
September 30 | Headcount down 2% from a year earlier |
The two annual reports break down the drop of about 5,000 full-time employees in the year to June 30: the US count fell by 4,000, to 121,000, and product research and development by 3,000, to 77,000, while operations held at 89,000.
What Microsoft has said about costs and AI
For the fiscal year that began in July, Hood said in April: “we continue to evolve how we operate to increase our pace and agility, and therefore, we expect headcount will decrease year-over-year.” She said operating expense growth would reflect investment in research and development, “inclusive of AI investment in compute, data, and talent.”
On October 28, alongside results for the quarter to September 30, she forecast operating expenses of $18.5 billion to $18.6 billion for the December quarter, up 9% from a year earlier and “driven by continued investment in R&D compute capacity and talent,” and said: “Our cost guidance across both COGS and OpEx includes an estimate for the recently announced employee voluntary exit offer.” She said Microsoft expects capital expenditures of more than $50 billion in the quarter.
In July, Coleman wrote that the roles Microsoft eliminated then “are not being replaced by AI,” and that “AI is changing how work gets done.”
