- Microsoft aims to cut down on “tokenmaxxing” by employees
- New guidelines will look to control AI token use to focus on ROI
- This is despite Microsoft reporting record financial results recently
Microsoft has apparently been forced to introduce limits on how much AI usage its engineers are allowed followed reports that some have been taking things to extreme.
The software giant is looking to cut back on “tokenmaxxing” within the company – where employees use far more AI tokens that may be necessary.
In an email seen by 404 Media, Microsoft warned employees that new limits on token usage would be introduced as it looked to focus on getting the most out of its AI platforms.
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New guidelines
“As we accelerate our use of GitHub Copilot to deliver on our goals, we all need to be aware of how we consume tokens,” the email to employees from Jay Parikh, an executive vice president at Microsoft said.
“Tokenmaxxing is not what we are optimizing for,” he continued. “I want all of us focused on maximizing outcomes that move the needle for our customers and our business.”
“As such, we are updating our internal guidance and managing token spend with the same discipline we apply to every other critical resource.”
In a bid to achieve “get greater value from our token investment”, Parikh went on to say Microsoft is making access to the cheaper OpenAI GPT-5.6 model the default model for internal use.
Employees were also reminded (via a link to updated internal Copilot guidelines) that as of July 2026 Microsoft divisions have an “AI token budget target,” with employees also able to track their individual AI spending.
“While there is no target spend value being shared at this time. The data shows that many engineers spend in the range of hundreds of dollars a month to a few thousand dollars in tokens,” 404 Media reported the guidelines as saying.
Parikh noted that Microsoft does not want to impair the company’s progress towards becoming “AI-first,” and that it will keep learning and adjusting its AI policies as models and products evolve.
“We are not optimizing for fewer tokens,” he said. “We are optimizing for more impact per token.”
The restrictions may come as a surprise to some Microsoft employees, given that the company recently reported yet another bumper financial quarter, and in that respect should have money to splash out on AI usage.
However it is the latest step by Microsoft as it looks to focus internal AI usage. In May 2026, it was reported the company was reportedly canceling most of the Claude Code license it uses internally, with engineers being told to use GitHub Copilot CLI, with users given a June 30 2026 deadline to remove Claude Code from their workflows.
However tokenmaxxing has proven to be an issue at other tech giants – perhaps most notoriously at Uber, which was forced to admit it had exhausted its entire annual 2026 AI coding token budget in just four months due to massive employee adoption of agentic tools like Anthropic PBC’s Claude Code and Cursor.
Amazon also recently revealed it had spent $1.8 million on an internal Claude Sonnet deployment intended for matching author details with product listings, after it ballooned far beyond its planned budget and was ultimately given menial tasks to do.
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