Google's Voluntary Exit Package: The AI Restructuring Behind Record Revenue

Alphabet has surpassed $400 billion in annual revenue for the first time in its history. Google Cloud grew 48% year-over-year, and the Gemini app reached 750 million monthly active users. Yet right after announcing these record-breaking results, Google handed exit packages to employees not fully committed to AI.

The numbers tell a story of peak performance, but beneath them lies a ruthless message echoing across Big Tech: go all-in on AI, or leave.

1. Alphabet Surpasses $400 Billion in Annual Revenue for the First Time

Alphabet's annual revenue for 2025 reached $403 billion, up 15% year-over-year. Fourth-quarter net income alone hit $34.5 billion, a 30% jump from the same period last year. CEO Sundar Pichai said during the earnings call, "No technology has me dreaming bigger than AI."

Google Cloud's growth stands out in particular. It surpassed a $70 billion annual run rate, with its order backlog surging 55% quarter-over-quarter to $240 billion. Gemini Enterprise secured 8 million paid seats in just four months. Pichai revealed that Gemini's serving costs were reduced by 78% throughout 2025.

These figures point to one conclusion: Google's AI transformation is already generating massive returns, and Alphabet is preparing an even bigger bet. The 2026 capital expenditure forecast stands at $175-185 billion, nearly double the previous year.

2. Voluntary Exit Package: Three Rounds of Messaging

Google's Voluntary Exit Package (VEP) program began in June 2025. The first round targeted engineering, marketing, and research employees and was announced alongside a return-to-office (RTO) policy. The second came in October 2025, a buyout offered to 7,500 YouTube employees.

The most recent, third VEP arrived on February 11, 2026, targeting U.S. employees in the Global Business Organization (GBO). Chief Business Officer Philipp Schindler wrote in an internal memo demanding employees go "all in" and "embrace AI." For those "not enjoying the pace," he offered an exit package.

Schindler's message is blunt: if you're not on board with the AI transformation, there's no place for you at Google. Google's Chief People Officer called the program "quite successful," with approximately 5% of employees in key departments accepting the package.

3. 35% Manager Reduction and Organizational Streamlining

Alongside the exit packages, Google has been overhauling its organizational structure. By August 2025, 35% of managers had been cut, primarily by eliminating management positions for teams with three or fewer members. This is interpreted as an effort to accelerate decision-making and transition to a flatter, AI-centric organization.

Google is shipping more than 250 AI-related products per quarter. Gemini 3 Pro recorded the fastest adoption rate in company history, processing over 10 billion tokens per minute. Google Antigravity, an AI agent platform, has reached 1.5 million weekly active users. To maintain this velocity, sluggish organizational layers are a luxury Google can no longer afford.

4. The AI Talent Paradox: Exit Packages Meet Aggressive Hiring

What makes this particularly striking is that Google is simultaneously pushing employees out one door while pulling AI talent in through another. Twenty percent of Google's AI software engineering hires are so-called "boomerang employees" who had previously left the company. Google also spent $2.7 billion on the Character.AI acquisition.

This isn't a contradiction; it's a strategy. Google doesn't want headcount reduction. It wants a fundamental transformation of its workforce composition. Employees without AI capabilities exit through voluntary packages, and AI specialists fill their seats. The total number might stay the same, but the quality and focus of the workforce shifts dramatically.

5. AI Restructuring Spreads Across Big Tech

This trend extends far beyond Google. Microsoft CEO Satya Nadella issued an ultimatum to employees in December 2025: commit to AI or leave. Microsoft laid off approximately 9,000 people in 2025. Across the entire tech industry, roughly 245,000 or more workers lost their jobs that year.

Simultaneously, AI infrastructure investment is ballooning to astronomical levels. Following Alphabet's $175-185 billion CapEx forecast for 2026, Amazon has planned $200 billion in capital expenditure for the same year. Spending on people goes down while spending on machines goes up. This is the common formula of Big Tech in 2026.

The collaboration with Apple is also noteworthy. News that Google's Gemini technology will be used in Apple's next-generation foundation models suggests that AI technology is becoming an industry standard that transcends competition.

In Closing: What Record Revenue Doesn't Guarantee

Alphabet's $400 billion revenue is proof that Google's AI transformation is succeeding financially. But the fact that a company posting all-time-high earnings is telling employees to "leave if you can't keep up" starkly illustrates how rapidly the labor market is changing in the AI era.

The message Google sends through its voluntary exit packages is simple: the AI transformation is not a choice but a matter of survival, and only those who can match the pace will remain in Big Tech. The era has arrived where record revenue doesn't guarantee every employee's future.