Meta lines up layoffs while Microsoft offers buyouts

Meta is laying off about 8,000 workers, or about 10 percent of its workforce, the company has said as it continues to ramp up spending on artificial intelligence infrastructure and highly paid AI-expert hires.

On Thursday, the company said it was making the cuts for the sake of efficiency and to allow new investments in parts of its business, as first reported by Bloomberg, which also said the company will leave about 6,000 jobs unfilled.

Also on Thursday, Microsoft said it was offering voluntary buyouts to thousands of its US employees.

The software giant plans to make the offers in early May to about 8,750 people, or 7 percent of its US workforce, according to two people familiar with the plan who were not authorised to speak about it publicly.

While an alternative to the sudden layoffs removing tech workers from peers like Meta and Oracle, the savings are likely tied to a similar industry upheaval that is requiring huge spending on the costs of artificial intelligence.

Meta has already warned investors that its 2026 expenses will grow significantly — to the range of $162bn to $169bn — driven by infrastructure costs and employee compensation, particularly for the AI experts it has been hiring at eye-popping pay levels.

This week, Meta also said it was breaking ground on an AI-optimised data centre in Tulsa, Oklahoma, a $1bn investment and its 28th data centre in the US.

Wedbush analyst Dan Ives welcomed Meta’s cuts in a note to investors on Thursday.

He said he sees it as part of a strategy of using AI tools to “automate tasks that once required large teams, allowing the company to streamline operations and reduce costs while maintaining productivity, driving an increased need for a leaner operating structure”.

Microsoft, based in Redmond, Washington state, has spent billions of dollars on operating an ever-expanding global network of data centres that power cloud computing services, AI systems and its own suite of productivity tools, including the AI assistant Copilot.

CNBC reported earlier on Thursday on a memo from Microsoft’s chief people officer, Amy Coleman, announcing the voluntary retirement plan.

“Our hope is that this program gives those eligible the choice to take that next step on their own terms, with generous company support,” Coleman wrote, according to CNBC.

Meta stock fell 2.3 percent on Thursday, while Microsoft stock ended the day down 3.97 percent.