Meta Platforms Inc. and Microsoft Corp. are implementing job cuts and buyout programs that could collectively impact as many as 23,000 positions. These moves are part of broader efforts to streamline operations and offset significant investments in artificial intelligence infrastructure.
Meta's Workforce Reduction
In an internal memo on Thursday, Meta announced plans to reduce its workforce by 10 percent, affecting approximately 8,000 employees. The cuts are scheduled to begin on May 20. Additionally, the social media company stated it would not fill 6,000 currently open roles. Janelle Gale, Meta's chief people officer, communicated the decision to staff, noting that the company aims to operate more efficiently and balance heavy spending on AI.
Microsoft's Voluntary Buyouts
Earlier the same day, Microsoft issued a memo offering voluntary buyouts to thousands of U.S. employees. About 7 percent of its U.S. workforce, or roughly 8,750 workers, are eligible for the program. This marks the first time Microsoft has conducted buyouts of this scale, according to a person familiar with the matter. The buyout eligibility is based on a formula combining years of service and age, totaling 70 or more, excluding certain senior roles and sales incentive plan participants.
Context of Cost-Cutting
Both technology giants are seeking ways to reduce expenses as they channel billions into data centers and other infrastructure to meet the surging demand for AI services. Microsoft is rapidly constructing data centers globally and recently announced new AI investments in Japan and Australia. Meta has projected record capital expenditures this year and has finalized several multibillion-dollar deals with AI partners in recent months. Both companies have conducted multiple rounds of layoffs in prior years.
Employee Reactions and Earnings
Meta employees have been anxious about job cuts, which have already affected the Reality Labs division and other teams. Gale acknowledged the unease but emphasized that early communication was necessary due to leaks. Microsoft's Chief People Officer Amy Coleman highlighted the company's urgency and pace, urging employees to stay focused. Both companies are scheduled to report quarterly earnings on April 29.
