Meta and Microsoft axe thousands of jobs in AI spending spree

Meta and Microsoft have announced major job cuts as the tech giants accelerate spending on artificial intelligence, underscoring a sharp pivot across Silicon Valley towards AI-driven growth.

Meta Platforms said it plans to cut around 8,000 roles, roughly 10 per cent of its global workforce, as part of a sweeping restructuring aimed at improving efficiency and redirecting resources towards its AI ambitions.

In a memo to staff, the company said the changes would allow it to prioritise investment in high-growth areas, including generative AI products such as chatbots and large language models. Around 6,000 additional roles will also be left unfilled as part of the wider cost-cutting effort.

The move comes as chief executive Mark Zuckerberg ramps up spending on computing infrastructure and AI talent to keep pace with rivals in an increasingly competitive sector.

Matt Britzman, senior equity analyst, Hargreaves Lansdown, said: “Reports of further headcount reductions at Meta come as little surprise and, while unfortunate for all involved, should be taken as a broadly positive signal.

“With heavy investment in top AI talent, trimming elsewhere points to a sharper focus on the individuals driving the next leg of growth.”

Meanwhile, Microsoft is taking a different approach, offering voluntary redundancy packages to around 8,750 employees, equivalent to about 7 per cent of its US workforce.

The programme, due to begin in early May, is designed to reduce headcount without compulsory layoffs, as the company continues to reshape its operations around AI integration across its product suite.

Both companies are expected to update investors next week, with markets closely watching the balance between heavy AI investment and cost discipline across the sector.

The announcements highlight the growing tension within Big Tech as firms pour billions into artificial intelligence infrastructure while simultaneously tightening workforces in more traditional business units.

Analysts say the wave of restructuring reflects a broader shift in priorities, as companies race to establish dominance in AI before regulatory pressure and rising costs reshape the competitive landscape.