The software giant said that the move is intended to provide greater flexibility for employees who may be considering retirement or a transition out of the company. Moreover, it also aligns with broader internal changes as the tech giant reallocates resources toward high-priority areas such as AI development and cloud infrastructure. The company has been accelerating its investments in data centres to supply its cloud clients with computing power that can handle generative AI models.

The buyout plan from Microsoft comes at a time when major technology firms are reassessing their workforce strategies as a response to rapid shifts in the industry, especially the growing emphasis on AI-led products and services.

Meanwhile, Meta Platforms, the parent company of Facebook and Instagram, has confirmed a significant round of layoffs affecting 10 per cent of its workforce, amounting to around 8,000 employees. In addition to the job cuts, the company will eliminate approximately 6,000 open roles as part of its cost-cutting efforts.

The parallel moves by Microsoft and Meta underscore a broader trend across the tech industry, where companies are balancing aggressive spending on AI with efforts to optimise workforce structures. While Microsoft is opting for voluntary exits among experienced employees, Meta is pursuing more direct reductions. This reflects differing approaches to managing costs and redefining operations in an increasingly AI-driven landscape.