Microsoft offers voluntary buyouts to 60,000 staff in four countries including India as AI spending climbs

Microsoft describes the programme as a way of allowing employees to leave with financial support and help with planning their careers. It is voluntary, and nobody is being forced out under it, but companies that run such programmes often follow them with involuntary cuts if too few people accept.

Why the company is doing it

The company's spending on infrastructure for artificial intelligence is the backdrop. Its chief financial officer said in July that Microsoft expects to spend about $175 billion on such infrastructure in 2026. A report on the latest quarter says free cash flow fell by 23 per cent from the year before. The buyouts are a way of lowering costs while the company builds data centres and buys chips at a record pace, and the company has described the move as part of an effort to balance investment with efficiency.

No outlet has said how many employees are likely to accept. An earlier voluntary programme at the company drew only about 30 per cent to a third of the eligible employees, according to reports, and if the same share took the present offer, about 18,000 to 20,000 people would leave. That is a guess based on the past, and the true number will be known only after the deadline.

Microsoft has a large presence in India, with development centres in Hyderabad, Bengaluru and Noida and a workforce in the tens of thousands, and India is one of the four countries covered. The reports do not say how many Indian employees are eligible or which teams are affected. A buyout in India would be handled under Indian labour law and company policy, and the terms offered there may differ from those in the United States.

The offer comes when the Indian technology industry is itself adjusting to the arrival of automation tools that can do some of the work of software developers, testers and support staff. Companies are hiring fewer entry-level engineers, and have asked the staff they keep to be more productive. A move by one of the world's largest software companies is watched as a signal of where the industry is heading.

The company has also announced large investments in India. A report from late last year said that it planned to spend $17.5 billion in the country over four years from 2026, mainly on cloud and data centre infrastructure. That is separate from the buyouts, and the two do not conflict: investment in machines can go along with a smaller number of staff.

The first date is the early December deadline, after which the company will know how many accepted. The second is whether other large technology companies, many of which have also been spending heavily on infrastructure, follow with similar offers. The third is the effect on hiring in India, where campus recruitment and mid-level jobs have been under pressure.

For an employee who is eligible, the choice involves the terms of the package, the chance of another job and the risk that a refusal will not protect against later cuts. For the industry, the question is whether the spending on infrastructure will bring revenue quickly enough to justify the cost, and the buyouts are a sign that the company wants to be prepared if it does not.