Oracle has begun notifying employees of thousands of job cuts, CNBC reported, citing sources, indicating that this happened amid the company facing a sharp drop in stock prices related to significant capital investments in AI infrastructure development, writes UNN.
Details
While Oracle's core business is suffering from market panic over competitive risks associated with generative artificial intelligence models, the company is also under pressure from investors due to the amount of debt it is raising for AI investments and declining cash flow.
Oracle, which employed 162,000 people as of May 2025, declined to comment. The company's stock price has fallen by 25% this year, more than all major technology companies.
Oracle continues to sell its flagship database for storing and servicing corporate information. In recent years, alongside cloud computing competitors such as Amazon, the company has increased capital expenditures to build data center infrastructure capable of handling artificial intelligence workloads. But Oracle is smaller than its competitors in the cloud space.
Oracle uses the loan market to finance its development. In January, Oracle announced plans to raise $50 billion in debt and equity. During last month's earnings report, executives said there were no plans to raise additional debt in 2026.
A reduction of 20,000-30,000 employees could increase free cash flow by $8-10 billion, TD Cowen analysts wrote in a January note.
Management stated that AI investments will pay off over time. "Demand for AI infrastructure, both GPUs and CPUs, continues to outstrip supply," said Oracle executive Clay Magouyrk during an earnings call earlier this month.
Meta plans large-scale layoffs amid rising AI costs - Reuters14.03.26, 10:07