Business & Finance
Microsoft Raises $25 Billion in Bonds After Offering Buyouts to 60,000 Employees
Microsoft priced a $25 billion bond sale, its first U.S. investment‑grade offering since 2017, three days after announcing voluntary exit packages for about 60,000 employees. The company said the proceeds will be used for general corporate purposes, including capital expenditures, as its AI data‑center bills rise.
On Wednesday’s earnings call, CFO Amy Hood said, “We’re fortunate to have access in the debt markets, given where our ratings are, and we haven’t yet tapped that.” The notes were priced a day later in ten tranches maturing between 2028 and 2066 and are set to close on November 4. The $25 billion sale attracted $115 billion in orders, about 4.6 times the amount offered. Fixed‑rate coupons range from 4.85 % on $2 billion of notes due 2028 to 6.35 % on $2 billion of notes due 2066, with two floating‑rate tranches of $1 billion each.
Microsoft and Johnson & Johnson are the only publicly traded U.S. companies with AAA ratings from both Moody’s and S&P. Microsoft last borrowed in this market in 2017, raising $17 billion. It is the first sale from a major hyperscaler since Alphabet priced $25 billion of debt in August; Meta chose equity instead.
The voluntary exit offer, announced on October 26, covers staff in India, the U.S., Canada and the U.K. Eligible employees are at level 70 or below in participating teams, more than a quarter of Microsoft’s 223,000 full‑time workforce. Chief People Officer Amy Coleman said the offer lets employees “make that transition now with support.” The plan is time‑limited and voluntary. Eligible teams include AI experiences, Copilot, finance, HR, Xbox and Windows + Devices; marketing, commercial business and security are excluded.
Microsoft expects 3,000 or fewer employees to take the buyout, or 5 % or less of those eligible, according to a spokesperson. Hood noted that the aim is to give employees “agency if they choose to leave the company on their own terms,” and that “we expect very few people to select this offer because of the growth opportunities here at Microsoft.”
Earlier this year, a voluntary retirement offer to about 9,000 U.S. employees was accepted by roughly one‑third of those eligible, helping Microsoft reduce the need for later layoffs. In July, the company announced 4,800 job cuts, about 2.1 % of its workforce, while overhauling Xbox.
In the quarter, revenue grew 19 %, operating income rose 21 % and Azure revenue climbed 48 %. Hood said Azure demand continues to exceed supply and thanked engineering teams for delivering capacity faster. Microsoft forecast about $175 billion in capital expenditure for 2026, the bill both moves are meant to help cover. The company will detail its AI and cloud plans at Ignite from November 17 to 20.
Frequently asked questions
How much did Microsoft raise in its bond sale?
$25 billion.
How many employees are eligible for the voluntary buyout?
About 60,000 employees across India, the U.S., Canada, and the U.K.