Two of the world’s largest tech companies, Meta and Microsoft, have announced major workforce cuts as part of cost-saving efforts to reinvest in AI.
Both companies sent out internal employee memos outlining their restructure plans this week.
On Thursday (U.S. time), Meta said it plans to lay off about 10% of its workforce next month and remove around 6,000 current job ads.
On the same day, Microsoft announced plans to cut around 7% of its U.S-based workforce, offering voluntary redundancy packages aimed at employees nearing retirement.
Meta
In an email sent to staff this week, Meta said it intends to lay off roughly 8,000 employees.
The social media giant said it would normally “nail down more details before communicating,” but was forced to confirm the plans after they were leaked.
In the five-paragraph memo, Chief People Officer Janelle Gale said the layoffs will take effect from 20 May.
She said the move is part of a “continued effort to run the company more efficiently and to allow us to offset the other investments we’re making.”
Gale said the decision wasn’t “an easy trade-off” and would mean “letting go of people who have made meaningful contributions to Meta”.
Laid-off staff in the U.S. have been told they will receive a “generous” employment package, including at least four months’ base pay, continued healthcare coverage, and career support services.
However, for affected employees outside the U.S, the packages will vary depending on location.
Gale said the company wouldn’t provide further details until later in May, acknowledging it left “everyone with nearly a month of ambiguity.”
Microsoft
Microsoft announced plans to cut 7% of its U.S. workforce, according to a memo to staff seen by the Financial Times.
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As of mid-last year, Microsoft employed about 125,000 people in the U.S., according to a Securities and Exchange Commission filing – meaning the cuts would affect roughly 8,750 staff.
In a first for the tech giant, Microsoft has offered voluntary redundancies to affected employees.
The offer applies to employees whose age plus years worked at Microsoft totals at least 70.
The latest changes follow a year of several job cuts at Microsoft, including three rounds of layoffs in 2025.
In January 2025, the company cut around 1% of its workforce over performance-related concerns.
Four months later, it reduced about 3% of staff, affecting roughly 6,000 roles.
Then, in July, the tech giant laid off 9,000 employees as it redirected investment towards AI and data centres.
AI investments
While neither company explicitly mentioned AI in their layoff memos, both Meta and Microsoft have recently made major efforts to redirect resources toward the technology.
In a January 2026 company call, Meta CEO Mark Zuckerberg pointed to a “major AI acceleration,” saying he expected “2026 to be a year where this wave accelerates even further on several fronts”.
The company is expected to spend up to $US135 billion (about $AU190 billion) this year, almost double its spending from the previous year.
Microsoft said it expects to spend at least $US100 billion (about $AU140 billion) on AI infrastructure this financial year.
CEO Satya Nadella said: “We are pushing the frontier across our entire AI stack to drive new value for our customers and partners.”
Separately, at a live event with Zuckerberg last year, Nadella said about 30% of the company’s code is now written by AI.
