Microsoft's AI Boom Runs Alongside Buyout Offers

Microsoft reported $36.6 billion in profit for the three months that ended in September while offering buyouts to about 60,000 workers across four countries. The company’s earnings surged as it poured billions into AI infrastructure, placing the scale of its investment beside the workers whose jobs it has put on the table.

Profit at the top, buyouts on offer

The buyout offer covers workers in the United States, Canada, Britain and India. That’s roughly a quarter of Microsoft’s workforce of about 223,000. Microsoft said it expected only a sliver of those offered a buyout to take it; the source gives no further detail about the terms of the offers or workers’ response.

This was Microsoft’s second buyout offer this year. In July, the company eliminated 20% of its Xbox workforce as part of roughly 4,800 job cuts and closed several game studios. The latest financial results and the buyout offer put two sides of the company’s decisions in the same frame: rising profit and a workforce facing offers to leave.

Microsoft’s revenue reached $92.3 billion, up 19% from a year earlier. Profit rose 32% to $36.6 billion. The results beat Wall Street expectations, and Microsoft shares rose more than 4% in after-hours trading Wednesday. Investors had reason to focus on the returns. Workers received buyout offers.

The AI spending race

Microsoft spent $45.2 billion on capital expenditures, including data centers, during the quarter. That was up about 30% from $34.9 billion a year earlier. In July, the company had told investors to expect more than $50 billion in spending on AI infrastructure.

Azure, Microsoft’s cloud computing service, drove much of the growth. The service lets businesses rent computing power, storage and AI tools. Azure sales increased 48% to $33.2 billion, after Microsoft began reporting the figure every quarter rather than disclosing it only occasionally.

Investors had been hoping for growth of about 45%, analysts said. Azure growth was up from 43% the previous quarter. The figure is the clearest sign of whether Microsoft’s AI spending is translating into sales. Here, the company’s infrastructure bill is measured against the revenue it can generate from cloud services rented to businesses.

The report gives no account of workers organizing around the buyout offers, or of mutual aid or other community responses. It also reports no legislative or electoral proposal tied to the job offers or AI spending. The figures it does give trace the company’s priorities: capital expenditures climbed, Azure sales grew, and thousands of workers were offered buyouts.

Microsoft’s stated expectation that only a sliver of workers will accept the offers doesn’t change their scale: about 60,000 people were included. The same quarter brought $92.3 billion in revenue and $36.6 billion in profit. Those numbers sit side by side in the company’s results, with the workers’ future left to individual decisions under the offer.