Oracle Announces Thousands of Job Cuts Due to AI
Software titan Oracle is reportedly planning to lay off thousands of employees due to escalating costs and cash needs in their process of expanding artificial intelligence data centers. It's indicated that the company is particularly aiming to reduce operational expenses in order to accelerate infrastructure investments.
According to industry sources, the competition among technology giants over artificial intelligence infrastructure is becoming increasingly fierce. Consequently, the high investment costs in this field are forcing companies to undertake restructuring and cost-cutting measures.
As companies sought ways to finance their investments in artificial intelligence, they began to downsize their workforce.
According to a report published by Bloomberg News on Thursday, Oracle, which has long held a limited position in the cloud market, has transformed into a significant player in the field of computing power rental, thanks to the impact of the $300 billion deal it signed with OpenAI last year.
However, investors are expressing concerns about how the company will finance the necessary data center expansion to serve not only OpenAI, but also major clients such as xAI and Meta.
Numerous departments within Oracle will be impacted by this process.
Billionaire Larry Ellison, who serves as the chairman of the board for Oracle, announced in February that the company aimed to secure financing between 45 and 50 billion dollars this year in order to expand its cloud infrastructure. This plan, however, has sparked growing concerns in the market about the company's escalating debt burden.
According to sources close to the matter, the planned layoffs are expected to impact several units within Oracle and are anticipated to commence this month. Moreover, it has been suggested that certain positions will be concentrated in job areas predicted to contract in the future due to the increasing use of artificial intelligence.
The pace of hiring has also slowed down.
The anticipated layoffs are expected to be more extensive than the gradual dismissals Oracle routinely conducts. According to a Bloomberg report, the company has begun reviewing many open positions in its cloud unit following an internal announcement made during the week. This move is said to have effectively slowed down or even frozen the hiring processes.
When Reuters reached out to Oracle officials for comment on the matter, they declined. According to the annual report submitted to the U.S. Securities and Exchange Commission, as of May 31, 2025, the company had approximately 162,000 full-time employees.
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