Meta and Microsoft move to cut thousands of jobs amid rising AI costs and operational restructuring

Meta Platforms and Microsoft have announced major workforce reductions as both companies seek to manage escalating costs tied to artificial intelligence development and infrastructure expansion.

The measures come days before both firms are scheduled to report quarterly earnings on 29 April 2026, signalling intensified efforts to streamline operations amid heavy capital commitments.

Meta outlines workforce cuts

According to AFP, Meta informed employees in an internal memo dated 23 April 2026 that it intends to cut approximately 10 per cent of its workforce.

The reduction is expected to affect around 8,000 employees, with layoffs set to begin on 20 May.

The company also confirmed that it will not fill 6,000 currently open positions, effectively deepening the scale of its workforce contraction.

The memo, written by chief people officer Janelle Gale, stated that the decision forms part of a broader strategy to improve efficiency while accommodating rising investment demands.

“We’re doing this as part of our continued effort to run the company more efficiently and to allow us to offset the other investments we’re making,” Gale wrote, according to a copy reviewed by Bloomberg.

Employees had already been anticipating further cuts following earlier layoffs affecting Reality Labs and other divisions. Gale noted that the announcement was made earlier than planned after details were leaked internally.

“I know this is unwelcome news and confirming this puts everyone in an uneasy state, but we feel this is the best path forward, given the circumstances,” she added.

Microsoft introduces large-scale buyouts

Microsoft announced a separate measure on the same day, offering voluntary buyouts to a significant portion of its United States workforce.

According to a source familiar with the planning, about 7 per cent of US-based employees will be eligible for the programme.

Based on the company’s workforce of 125,000 employees in the United States as at June 2025, this translates to approximately 8,750 workers.

The buyouts are being offered to employees whose combined age and years of service total 70 or more, excluding certain senior roles and those on sales incentive plans.

Chief people officer Amy Coleman described the move as part of a broader effort to maintain organisational agility during a period of rapid transformation.

“I’ve never seen the company move with this level of urgency and pace,” Coleman wrote in the memo reviewed by Bloomberg.

“To sustain this pace, we have to stay focused on doing great work, trusting and empowering our managers and simplifying to support everyone.”

AI spending drives restructuring

Both companies are making these workforce adjustments as they commit substantial resources to artificial intelligence infrastructure.

Microsoft is expanding its global network of data centres and recently announced new AI investments in Japan and Australia.

Meta has projected record capital expenditure in 2026 and has entered multiple multi-billion-dollar partnerships with AI firms in recent months.

The announcements reflect a broader trend across the technology sector, where companies are cutting operational costs to fund long-term investments in AI capabilities and supporting infrastructure.

Both Meta and Microsoft have conducted several rounds of layoffs in recent years, underscoring the scale of restructuring required to sustain their strategic priorities in an increasingly competitive AI landscape.