Oracle plans thousands of job cuts amid costly AI data centre expansion

By Brody Ford

 

Oracle Corp. is planning to ax thousands of jobs, among its moves to handle a cash crunch from a massive AI data centre expansion effort. 

The job reductions will affect divisions across the company and may be implemented as soon as this month, according to people familiar with the matter who asked not to be named discussing the still-private plans. Some of the cuts will be aimed at job categories that the company expects it will need less of due to AI, two of the people said.

 

Led by Chairman Larry Ellison, Oracle is embarking on a historic build-out of data centres to power AI workloads for customers such as OpenAI. The company, long known for its database software, has been making a transition in the past few years to bulk up its cloud computing unit with a focus on AI, intending to become a viable competitor to market leaders Amazon.com Inc. and Microsoft Corp.

 

Wall Street projects the expenditures by the cloud unit for data centres to push Oracle’s cash flow negative over the coming years before the spending begins to pay off in 2030, according to data compiled by Bloomberg. Last month, Oracle said it would raise as much as $50 billion this year through a combination of debt and equity sales.

 

The reductions being planned are expected to be wider-reaching than the company’s typical rolling job cuts, according to the people. This week, Oracle announced internally that it would be reviewing many of the open job listings in its cloud division, effectively slowing down or freezing the hiring process, according to people with knowledge of the move. 

 

Oracle declined to comment. The company had about 162,000 employees globally as of the end of May 2025. Planning for the workforce reductions is still active and could change, the people said.

 

Oracle’s initial moves as an AI cloud provider drew favour from investors, who boosted the stock 61 per cent in 2024 and 20 per cent last year. However, as the costs increased, the market has soured on the company, with the shares falling 54 per cent from their September 2025 high through Wednesday’s close.

 

After the report, the stock on Thursday gave back earlier gains, declining as much as 1.5 per cent to $150.12.

 

The high up-front costs of AI have fueled cuts across the tech industry as companies work to balance their budgets. Microsoft fired some 15,000 people last year amid rising spending on data centres and AI software development. Last week, Block Inc. announced that it would lay off nearly half of its staff, with co-founder Jack Dorsey citing the efficiency-boosting power of AI. 

  In September, Oracle disclosed in a filing that it was planning its largest-ever restructuring, which will cost as much as $1.6 billion in the current fiscal year ending in May, including severance checks to exiting employees. That was significantly larger than any other similar plan Oracle has disclosed. The company is scheduled to announce its fiscal third-quarter earnings on Tuesday.