Microsoft has announced a new program called the Voluntary Exit Offer that it’s extending to thousands of workers at the company, including people on the Xbox team.
Microsoft is doing this to shed employees, but the messaging is that a program like this could be appealing to someone who was already thinking about leaving and can now do so with a pay package.
Microsoft shared the high-level details of the Voluntary Exit Offer on its blog, and Bloomberg had more insight. The report said 60,000 workers are eligible for the Voluntary Exit Offer, and this works out to more than 25% of Microsoft’s entire workforce.
Bloomberg reported that Xbox is one of the divisions of Microsoft whose employees can leave the company via the Voluntary Exit Offer, along with Windows, Copilot, and finance teams. The report said people working on Microsoft’s efforts in data centers, sales, marketing, cyber security, and quantum computing are not eligible.
Microsoft made this announcement just two days before it releases its next earnings report on October 28. The technology giant is spending hundreds of billions of dollars in its massive AI push, and many in the investment community have questioned if that level of capital expenditure makes sense.
In April this year, Microsoft offered a Voluntary Retirement Program, and it offered severance pay, ongoing stock vesting, and extended health benefits. About 33% of eligible workers took that deal. Mass layoffs came in July, affecting nearly 5,000 people, including major cuts at Xbox. Terms of the new Voluntary Exit Offer are not available, but a spokesperson told Bloomberg that those who take the offer will receive benefits similar to a severance package.
For Xbox specifically, it was reported that further layoffs could be announced in October, with another round set for November, and then another in January 2027. However, The Verge’s Tom Warren said the October layoffs at Xbox are not happening this month, but will occur later. Xbox has been undergoing a “reset” under the leadership of CEO Asha Sharma, and this has included mass layoffs, studio closures, and game cancellations, among other dramatic moves.
These changes are happening at Microsoft amid huge surges in revenue and profitability for the company. For the latest period, Microsoft reported $90 billion in revenue (up 18%) and a profit of $35.8 billion (up 22%). As mentioned, the newest data will be revealed on October 28, so keep checking back for more.
CEO Satya Nadella addressed the seemingly discordant nature of cutting staff so massively at a time when the company is making so much money. In a memo, he said, “This is the enigma of success.”
