Microsoft (MS) will carry out its first-ever voluntary retirement program for thousands of employees as market concerns grow over the returns from its artificial intelligence (AI) investments.
According to U.S. outlet CNBC and other foreign media on the 23rd (local time), MS recently notified U.S.-based employees of a "one-time retirement program." It targets veteran staff at the senior director level and below whose age plus years of service exceed 70. About 7% of the U.S. workforce, roughly 8,750 people, are said to be eligible.
Amy Coleman, MS chief human resources officer, said in an internal memo that the company aims to reduce headcount before July, when the new fiscal year begins. Coleman said, "We want to offer employees who have built this company over decades the opportunity to choose their next chapter with full support."
The move underscores MS's burden between expanded AI investment and delayed revenue recovery. MS helped lead the AI boom through its partnership with OpenAI, but the adoption rate of its key paid AI product, "365 Copilot," is reportedly at about 3% of MS 365 subscribers. Concerns over slowing cloud growth and reliance on OpenAI have compounded, sending the stock down about 24% in the first quarter this year.
Big Tech broadly is moving to control expenses. Meta is pursuing cuts of about 8,000 employees, or roughly 10% of its workforce, and canceling 6,000 open positions, while stressing efficiency due to the burden of AI infrastructure investments.