Meta axes 8,000 jobs to fund AI spending spree, Microsoft to follow suit
Two of the world's biggest tech companies are shrinking their headcounts — Meta through layoffs, Microsoft through buyouts — as the AI spending race heats up.
Meta is cutting roughly 8,000 jobs or around 10% of its workforce as it funnels ever more cash into artificial intelligence and the sky-high salaries needed to attract AI talent.
The company confirmed the cuts on Thursday, framing them as a drive for efficiency to free up investment in priority areas of the business. Bloomberg, which first reported the news, also said Meta plans to leave around 6,000 vacancies unfilled.
Meta has already told investors its costs will balloon significantly next year, to somewhere between $162bn (€143bn) and $169bn (€150bn), driven by infrastructure spending and the increasingly eye-watering pay packets it is offering AI specialists.
Wedbush analyst Dan Ives was upbeat about the cuts in a note to investors, arguing Meta was using AI tools to "automate tasks that once required large teams, allowing the company to streamline operations and reduce costs while maintaining productivity [and] driving an increased need for a leaner operating structure."
Also on Thursday, Microsoft said it was offering voluntary buyouts to thousands of US employees.
The software giant plans to extend offers in early May to around 8,750 workers, roughly 7% of its US workforce, according to two people familiar with the plan who were not authorised to speak publicly.
Unlike the blunter instrument of mass layoffs used by Meta and Oracle, Microsoft's approach gives staff the option to leave on their own terms.
The savings, however, are likely driven by the same underlying pressure, namely the enormous cost of building out AI infrastructure.
Microsoft has spent billions running an ever-expanding global network of data centres powering cloud computing, AI systems and its own suite of productivity tools, including the AI assistant Copilot.
According to CNBC, which featured a memo from Microsoft's chief people officer Amy Coleman in their reporting, the company said it wanted to give eligible employees "the choice to take that next step on their own terms, with generous company support".
Meta outlined plans to cut about 8,000 jobs on Thursday as it invests heavily in artificial intelligence. The move comes as part of a broader tech-sector shift towards cost control, with Microsoft also weighing voluntary buyouts ahead of next week’s earnings reports.
Issued on: 24/04/2026 -
FRANCE 24
Meta plans to cut a tenth of its workforce, looking for productivity gains from its remaining workers as it invests heavily in artificial intelligence.
Meta will lay off about 8,000 employees and leave thousands of other positions unfilled next month, a source told AFP.
The move comes as co-founder and chief executive Mark Zuckerberg makes a priority of delivering “superintelligence” in a costly AI race against rivals including Amazon, Google, Microsoft and OpenAI.
Reports on Thursday also indicated that Microsoft is looking to trim its ranks with voluntary buyouts of some US employees in an unprecedented move by the tech stalwart founded in 1975.
About seven percent of US employees at Microsoft were reported to be eligible for an offer aimed at workers who are senior director level or lower, whose years of employment and age add up to 70 or more, according to a CNBC report.
Microsoft, which has also been pouring billions of dollars into AI, declined to comment.
Meta and Microsoft are both set to report quarterly earnings next week.
Meta in January reported quarterly earnings that topped market expectations, as revenue grew along with investments in AI.
Meanwhile, costs tallied $35.15 billion, an increase of 40 percent from the same period a year earlier, the earnings report noted.
Capital expenses, including infrastructure such as data centres to power AI, were $22.14 billion in the quarter, according to the company.
Meta anticipated capital expenditures in the $115 billion to $135 billion range this fiscal year, driven by increased investment in Meta Superintelligence Labs and its core business.
“I’m looking forward to advancing personal superintelligence for people around the world in 2026,” Zuckerberg said on an earnings call.
Meta is locked in a bitter rivalry with other tech behemoths racing to invest heavily in AI, aiming to ensure the technology generates profits in the not-so-distant future.
Most analysts believe Meta will make the investment pay off by improving advertising efficiency and creating new opportunities, such as with its smart glasses through a partnership with Ray-Ban maker EssilorLuxottica.
Meta is ramping up spending to record highs, announcing an array of multi-billion-dollar deals with AI partners and incentivising employees to be more productive by using AI agents for coding and other tasks, according to Wedbush analyst Dan Ives.
Ives reasoned that more layoffs could be in store at Meta this year as part of a strategy to use AI to gain efficiencies.
“We believe that this is part of Meta’s strategy to increasing leverage AI tools to automate tasks that once required large teams, allowing the company to streamline operations and reduce costs,” Ives said in a note to investors.
“We are encouraged by management’s cost-cutting efforts thus far.”
(FRANCE 24 with AFP)
Facebook's parent company said it would slash 10% of its workforce, while Microsoft is offering an early retirement scheme. The cuts come as both tech giants make massive investments in AI.
Social media giant Meta on Thursday announced plans to lay off about 8,000 employees, or about 10% of its workforce, as it seeks to scale up development of artificial intelligence (AI) applications.
The owner of social media platforms Facebookand Instagram, along with the messaging app Whatsapp, said in an internal memo that the first round of cuts is due on May 20. Along with the cuts, Meta said 6,000 further posts would be left unfilled.
Also on Thursday, US media reported that tech giant Microsoft was planning to offer voluntary early retirement buyouts for around 8.700 workers, or about 7% of its workforce.
Massive AI investment
The job cuts come as both companies increase spending on developing AI applications.
Meta has announced plans to develop "personal superintelligence," which CEO Mark Zuckerberg has said will tailor AI agents to the needs and wishes of individual users.
"Personal superintelligence that knows us deeply, understands our goals, and can help us achieve them will be by far the most useful. Personal devices like glasses that understand our context because they can see what we see, hear what we hear, and interact with us throughout the day will become our primary computing devices," Zuckerberg wrote in July 2025.
Meta has warned investors that expenses on infrastructure costs and hiring AI experts will grow to as much as $169 billion in 2026.
Microsoft is spending billions of dollars on expanding a global network of data centers that power cloud computing and AI systems like Copilot. Investor concerns about the costs and eventual profitability of data centers have weighed heavily on Microsoft's share price over the past 6 months.
The early retirement buyout program is a first for the legacy tech giant founded in 1975.
Edited by: Karl Sexton
Wesley Rahn Editor and reporter focusing on geopolitics and current affairs
Amid AI shift, tech firms like Microsoft cut staff and alter pay
24.04.2026, DPA
Photo: Amazon/dpa-tmn
Microsoft is rolling out voluntary buyouts for some of its US employees, a first for the 51-year-old tech giant as it adjusts to the rapid advancements in artificial intelligence (AI).
The one-time retirement programme is open to eligible workers at the senior director level and below who have a combined age and years of service totalling at least 70.
Some 7% of Microsoft's US workforce meets this criterion, as per a source familiar with the situation.
Employees are set to receive detailed information on May 7, but those on sales incentive plans won't qualify.
The initiative comes as Microsoft increases its spending on data centres to meet the rising demand for AI-driven cloud services, a trend that's also being seen in companies like Alphabet and Amazon.
At the same time, the software industry as a whole is facing challenges, especially with new AI coding tools from firms like Anthropic potentially upending traditional business models.
Microsoft has already taken measures to reduce expenses, including several rounds of layoffs last year. By June 2025, the company had around 228,000 employees worldwide, with roughly 125,000 in the US.
Alongside the buyouts, Microsoft is also adjusting its employee compensation structure. Managers won't have to tie stock awards directly to cash bonuses anymore, giving them more flexibility to recognize performance. Plus, the company is simplifying its performance review system, cutting the number of pay options for managers from nine to five.
These changes underscore Microsoft's ongoing efforts to streamline operations and shift resources as it prepares for long-term growth in the AI age.
The news comes as US tech giant Meta prepares to cut 10% of its workforce next month as it invests heavily in AI, according to local reports.
The company, which owns social media sites such as Facebook and Instagram, told employees in an internal email that the major round of redundancies is to be made on May 20, US media reports say.
Meta had just under 79,000 employees at the turn of the year, meaning the cuts are likely to affect nearly 8,000 people. In addition, some 6,000 vacant positions will not be filled.
The reason given for the redundancies was a desire to make the company more efficient and balance expenditure.
Meta is investing heavily in artificial intelligence infrastructure. For this year alone, capital investments of between $115 billion and $135 billion have been promised.
Meta to track staff’s keystrokes and clicks to train its AI, report
Meta is reportedly using workplace tracking software to collect data from employees in order to train its artificial intelligence systems. The move raises questions about how far companies can go in using staff activity to improve AI tools.
Most users know that platforms such as Instagram track their behaviour and preferences to train algorithms. Now, employees of the company behind Instagram, Facebook, and WhatsApp are subject to a similar kind of tracking, used to feed the development of AI systems.
According to Reuters, the global tech company is set to capture workers’ mouse movements, clicks and keystrokes. In some cases, it might even take snapshots of what is displayed on their screens.
The software doing this is called Model Capability Initiative (MCI). It runs on a specific list of websites and workapps and basically transforms the employees’ daily behaviour into training data for Meta’s AI models.
A Meta spokesperson told TechCrunch the company needs real examples of how people use computers.
CNBC reported that among the several hundred websites on this list are Google, LinkedIn, Wikipedia, Slack and GitHub.
Opting out is not an option
According to the reports, the software is installed on US-based employees - who do not have the option to opt out. But Meta told its workforce, according to the memos quoted by Reuters, that data gathered through the system would not be used for employee performance evaluations or any purpose other than AI training.
The reported use of employee activity as training data shows how workplace behaviour is becoming part of AI development. It raises questions about where productivity ends and monitoring begins.
No comments:
Post a Comment