Enterprise software company Oracle is planning thousands of job cuts as it faces financial pressure from a massive AI data center expansion effort. Long a smaller cloud market player, Oracle has become a significant player in renting computing power, partly due to its substantial deal with OpenAI.
Investors have expressed concern about funding the necessary data center expansion for clients like OpenAI, xAI, and Meta. In February, Oracle outlined plans to raise $45 billion to $50 billion this year to expand its cloud infrastructure, raising worries about its increasing debt.
The layoffs are expected to span across Oracle divisions and could begin as soon as this month, with some cuts targeting roles anticipated to diminish due to AI advancements. These reductions are anticipated to be more extensive than Oracle's usual job adjustments.
This week, Oracle internally announced a review of open positions in its cloud division, effectively slowing or freezing hiring. Oracle declined to comment when contacted.