Meta plans to cut about 8,000 jobs, and Microsoft is preparing buyout offers for thousands of U.S. employees as AI spending reshapes tech costs.
Meta plans to lay off roughly 8,000 employees, about 10 per cent of its workforce, while Microsoft is preparing voluntary buyout offers for thousands of U.S. workers, the latest signs of cost pressure across major technology companies investing heavily in artificial intelligence.
Meta confirmed that its layoffs will begin May 20. In an internal memo to employees, the company said the cuts are meant to make the business more efficient and help offset other investments as it pushes deeper into AI.
The reductions come as large technology companies are spending heavily on data centres, AI systems and specialized talent. Meta has warned investors that its 2026 expenses are expected to rise sharply, to between $162 billion US and $169 billion US, driven by infrastructure costs and employee compensation, including for artificial intelligence experts.
Bloomberg first reported Meta’s job cuts and said the company also plans to leave about 6,000 jobs unfilled. It is not yet clear where the layoffs will fall. Meta has Canadian offices in Vancouver, Toronto and Montreal.
Wedbush Securities analyst Dan Ives said in a Thursday note that the cuts fit with Meta’s effort to use AI tools to automate work, streamline operations and lower costs while maintaining productivity. He also said additional cuts at Meta could come later this year as the company continues to reduce costs and build out its AI capabilities.
Meta has framed its long-term AI ambitions in broad terms. In a January regulatory filing, the company said it is working on “the next generation of AI models” and on what it calls superintelligence, which it defines as AI that surpasses human intelligence. The company said it is investing now because it believes the technology could begin a new era of individual empowerment.
Microsoft, meanwhile, said it is offering voluntary buyouts to thousands of U.S. employees. The company plans to make the offers in early May to about 8,750 workers, or roughly seven per cent of its U.S. workforce, according to two people familiar with the plan who were not authorized to discuss it publicly.
CNBC reported Thursday on a memo from Microsoft 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.
Microsoft, based in Redmond, Wash., has spent billions of dollars expanding a global network of data centres that support cloud computing, AI systems and products including its Copilot assistant. The company has also pledged a $19-billion AI investment in Canada.
The immediate question for workers is how the cuts and buyout offers will be distributed. Meta has confirmed the start date for its layoffs, but the affected teams and locations remain unclear. Microsoft’s voluntary program is expected to begin with U.S. employees in early May.
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