Two of the world’s largest technology companies are simultaneously cutting their workforces while committing hundreds of billions of dollars to artificial intelligence, illustrating how the AI arms race is reshaping the economics of Big Tech employment.
Meta confirms plans to lay off roughly 8,000 employees, approximately 10% of its 79,000-strong workforce, with the cuts set to begin on May 20th, CBS News reports.
In an internal memo to workers, the company says the job cuts are intended to make the organization more efficient and to offset its other investments.
In the firm’s Q4 2025 earnings report, Meta CFO Susan Li outlined a massive increase in infrastructure spending for AI development as the company pushes for Personal Superintelligence.
“We anticipate 2026 capital expenditures, including principal payments on finance leases, to be in the range of $115–135 billion, with year-over-year growth driven by increased investment to support our Meta Superintelligence Labs efforts and core business.”
Meanwhile, Microsoft is taking a different but equally telling approach. The 51-year-old software giant is offering voluntary buyouts to US employees for the first time in its history, reports CNBC.
The move is a one-time retirement program available to workers at the senior director level and below whose combined years of employment and age total 70 or more. Approximately 7% of US employees are eligible, with details being sent to eligible workers and their managers on May 7th.
Amy Coleman, executive vice president and chief people officer at Microsoft, says the move is an act of generosity rather than cost-cutting.
“Our hope is that this program gives those eligible the choice to take that next step on their own terms, with generous company support.”
Earlier this year, Microsoft projected between $105 billion and $120 billion in AI spending this year, bringing the combined AI capital expenditure commitments of the two companies to as much as $255 billion in 2026 alone.
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