Microsoft Offers Buyouts to 60,000 Employees

Microsoft is extending voluntary buyout offers to approximately 60,000 employees across the United States, United Kingdom, Canada, and India. This move represents the largest such offer in the company's history and expands upon a previous retirement package that reached only 9,000 workers earlier this year. The company aims to lower operating expenses and headcount to preserve investment in artificial intelligence infrastructure.

CEO Satya Nadella has previously outlined this financial strategy in a podcast interview from nearly two years ago. He stated that total people costs would decrease while the cost per head and GPU allocation per researcher would increase. This approach indicates a workforce reduction where remaining employees receive higher salaries and greater access to AI tools.

Microsoft's headcount has declined for the first time in a decade. As of June 30, the company employs roughly 223,000 people, a reduction of 5,000 from the 228,000 staffed in 2025. This year's buyout offer covers about a quarter of the total workforce. In contrast, more than 30 percent of eligible employees accepted the earlier retirement offer, but the new package closely mirrors standard severance terms, including cash payments based on tenure, accelerated stock vesting, and subsidized health coverage.

Employees have until December to decide whether to accept the offer. Even if only 5 percent of the 60,000 eligible workers participate, the company would lose 3,000 staff. Rumors suggest further layoffs are possible in November and January, meaning the response to this current offer will likely inform future staffing decisions.

Merill Fernando, a former Microsoft Entra product manager, supports the reduction in headcount. He described the company as having numerous small organizations with distinct priorities and decision makers, creating silos that hinder collective action. Nadella acknowledged these internal tensions last year, noting that while social cohesion is not the primary goal, winning in the marketplace is.

Changes are also occurring within the Xbox division. Dan Greenawalt, the creative lead behind Forza Motorsport, is retiring after nearly 27 years. He will step down as head of Turn 10 Studios, which has merged with Playground Games. Trevor Williams, head of Playground Games, announced the transition in an internal memo. Greenawalt will serve as an adviser during his departure process.

The merger of Turn 10 and Playground Games concluded last month as part of a wider Xbox restructuring. Turn 10 lost over 70 employees last year, and its remaining staff now work on Forza Horizon and Fable. Meanwhile, Helen Chiang, who served as Xbox chief operating officer for a few months, is leaving Microsoft after 21 years. Xbox chief Asha Sharma announced Chiang's departure in a memo, stating that plans for the COO role will be finalized soon.

Additionally, sources indicate Bethesda is preparing to name its next game in the Elder Scrolls series. The title, reportedly The Elder Scrolls VI: Sentinel, is expected to be revealed next month. The game will be set in Hammerfell and marks the first entry in the series to focus on the history of the Elder Scrolls artifacts.