Microsoft India pay rises falter amid global exit offer

By Nathan Brooks

Ninety-one percent of Microsoft respondents in India received salary increases of 5% or less during the 2026 appraisal cycle, compared with 45% in the previous year's survey. Blind's survey covered 2,178 professionals based in India between October 15 and October 26.

For employers, the findings put reward-budget calibration, rating governance and retention planning on the agenda. They emerged as Microsoft combined heavy artificial intelligence infrastructure spending with cost-cutting. Microsoft paired those company-level investments with a voluntary exit offer for tens of thousands of workers globally, placing employee job security within the same compensation conversation.

What changed in Microsoft pay?

Only 5% of Microsoft respondents said their salaries increased by more than 10%, down from 27% a year earlier. Dissatisfaction with appraisal outcomes ran higher still: 86% said they were unhappy. The 91% finding shifts attention from exceptional increases to the pay decisions affecting most Microsoft respondents in this survey, making broad calibration more relevant than a few larger awards.

The 2,178-person sample covered survey participants rather than Microsoft's entire India workforce. The report also did not provide a separate count for the Microsoft subgroup, so the 91% finding cannot represent the company's average increase for every employee.

What shaped employees' appraisal outcomes?

• Around 41% cited their company's financial performance or cost-cutting as the main influence.
• Another 18% cited changing priorities arising from artificial intelligence and automation.
• Only 22% said their individual performance ratings had the biggest role in determining their increases.

Across all respondents, around 35% received no increment or faced a salary cut. Another 59% said their raises stopped at 5% or less, while 63% expressed dissatisfaction with salary revisions. The Microsoft and all-respondent figures use different denominators, so they describe related compensation concerns without measuring the same population or the same appraisal outcome precisely.

These responses make explanation quality a core part of compensation governance. HR teams should test whether employees can distinguish company-level cost decisions from individual performance, rather than leaving each manager to absorb the credibility gap.

What does the voluntary exit offer change?

Microsoft announced its Voluntary Exit Offer on October 26. Chief people officer Amy Coleman made the announcement for eligible employees at Level 70 and below in participating teams in Canada, India, the United Kingdom and the United States. The offer covers around 60,000 employees globally.

Microsoft said the initiative would give employees considering a move "an opportunity to make that transition with support."

HR teams now face three process decisions: confirming who qualifies, communicating departure terms and protecting critical skills before employees leave. The program's scale makes workforce planning more urgent, particularly as Microsoft increases spending on artificial intelligence infrastructure.

Blind recorded a 60% year-on-year rise in India searches related to buyouts and voluntary exit programs. Searches concerning layoffs and severance accounted for 21%, compared with 16% previously. Interest in salary hikes, raises and pay freezes declined by 7%. These search signals show employee concern, but they do not prove that respondents will leave their jobs.

How strong are Microsoft's results?

• Microsoft reported $92.3 billion in revenue for the quarter ended September 30, up 19% year on year.
• Net income reached $36.6 billion, up 32%.
• Microsoft Cloud revenue reached $63.9 billion, up 30%.
• Azure revenue grew 48% during the quarter.

Microsoft also continued investing heavily in artificial intelligence infrastructure. The company's results show why employees and executives may describe the same cycle differently. Revenue, profit and cloud growth remained strong, while respondents tied smaller increases to cost-cutting and changing artificial intelligence priorities.

What should employers test next?

Microsoft's juxtaposition is the test: revenue and cloud growth accelerated while reported raises narrowed and exit-related searches climbed across India, creating a direct tension between financial performance and workforce confidence. Reward leaders should document how corporate funding choices, changing automation priorities and individual performance interact in each appraisal.

Retention planning should model which critical roles remain exposed to voluntary departure rather than treating the 60,000 global figure as an India headcount. Exit communications should also state eligibility and support clearly.

Most importantly, employers should test whether employees understand why strong company results produced modest increases. The next test for Microsoft is whether that financial strength can support trusted pay decisions before broader exit interest becomes a larger retention problem.